Correlation Between Celsius Holdings and Coca Cola
Can any of the company-specific risk be diversified away by investing in both Celsius Holdings and Coca Cola 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 Celsius Holdings and Coca Cola into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Celsius Holdings and Coca Cola Consolidated, you can compare the effects of market volatilities on Celsius Holdings and Coca Cola 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 Celsius Holdings with a short position of Coca Cola. Check out your portfolio center. Please also check ongoing floating volatility patterns of Celsius Holdings and Coca Cola.
Diversification Opportunities for Celsius Holdings and Coca Cola
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Celsius and Coca is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Celsius Holdings and Coca Cola Consolidated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coca Cola Consolidated and Celsius Holdings 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 Celsius Holdings are associated (or correlated) with Coca Cola. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coca Cola Consolidated has no effect on the direction of Celsius Holdings i.e., Celsius Holdings and Coca Cola go up and down completely randomly.
Pair Corralation between Celsius Holdings and Coca Cola
Given the investment horizon of 90 days Celsius Holdings is expected to generate 5.87 times less return on investment than Coca Cola. In addition to that, Celsius Holdings is 1.76 times more volatile than Coca Cola Consolidated. It trades about 0.01 of its total potential returns per unit of risk. Coca Cola Consolidated is currently generating about 0.11 per unit of volatility. If you would invest 50,834 in Coca Cola Consolidated on August 27, 2024 and sell it today you would earn a total of 75,158 from holding Coca Cola Consolidated or generate 147.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Celsius Holdings vs. Coca Cola Consolidated
Performance |
| Timeline |
| Celsius Holdings |
| Coca Cola Consolidated |
Celsius Holdings and Coca Cola Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Celsius Holdings and Coca Cola
The main advantage of trading using opposite Celsius Holdings and Coca Cola positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Celsius Holdings position performs unexpectedly, Coca Cola 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 Coca Cola will offset losses from the drop in Coca Cola's long position.| Celsius Holdings vs. Vita Coco | Celsius Holdings vs. Keurig Dr Pepper | Celsius Holdings vs. PepsiCo | Celsius Holdings vs. Coca Cola Femsa SAB |
| Coca Cola vs. The Coca Cola | Coca Cola vs. Monster Beverage Corp | Coca Cola vs. Celsius Holdings | Coca Cola vs. Keurig Dr Pepper |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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