Correlation Between COCA COLA and Identiv
Can any of the company-specific risk be diversified away by investing in both COCA COLA and Identiv at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining COCA COLA and Identiv into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COCA A HBC and Identiv, you can compare the effects of market volatilities on COCA COLA and Identiv and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in COCA COLA with a short position of Identiv. Check out your portfolio center. Please also check ongoing floating volatility patterns of COCA COLA and Identiv.
Diversification Opportunities for COCA COLA and Identiv
Average diversification
The 3 months correlation between COCA and Identiv is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding COCA A HBC and Identiv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Identiv and COCA COLA is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on COCA A HBC are associated (or correlated) with Identiv. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Identiv has no effect on the direction of COCA COLA i.e., COCA COLA and Identiv go up and down completely randomly.
Pair Corralation between COCA COLA and Identiv
Assuming the 90 days trading horizon COCA COLA is expected to generate 4.54 times less return on investment than Identiv. But when comparing it to its historical volatility, COCA A HBC is 1.69 times less risky than Identiv. It trades about 0.09 of its potential returns per unit of risk. Identiv is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 322.00 in Identiv on August 28, 2024 and sell it today you would earn a total of 49.00 from holding Identiv or generate 15.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COCA A HBC vs. Identiv
Performance |
| Timeline |
| COCA A HBC |
| Identiv |
COCA COLA and Identiv Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COCA COLA and Identiv
The main advantage of trading using opposite COCA COLA and Identiv positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COCA COLA position performs unexpectedly, Identiv can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Identiv will offset losses from the drop in Identiv's long position.| COCA COLA vs. Superior Plus Corp | COCA COLA vs. NMI Holdings | COCA COLA vs. Origin Agritech | COCA COLA vs. SIVERS SEMICONDUCTORS AB |
| Identiv vs. VIRG NATL BANKSH | Identiv vs. CDN IMPERIAL BANK | Identiv vs. UNITED UTILITIES GR | Identiv vs. Ameriprise Financial |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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