Correlation Between Coca Cola and Expat Czech
Can any of the company-specific risk be diversified away by investing in both Coca Cola and Expat Czech 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 Expat Czech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coca Cola FEMSA SAB and Expat Czech PX, you can compare the effects of market volatilities on Coca Cola and Expat Czech 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 Expat Czech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and Expat Czech.
Diversification Opportunities for Coca Cola and Expat Czech
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Coca and Expat is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Coca Cola FEMSA SAB and Expat Czech PX in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Expat Czech PX 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 Cola FEMSA SAB are associated (or correlated) with Expat Czech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Expat Czech PX has no effect on the direction of Coca Cola i.e., Coca Cola and Expat Czech go up and down completely randomly.
Pair Corralation between Coca Cola and Expat Czech
Assuming the 90 days trading horizon Coca Cola FEMSA SAB is expected to generate 22.03 times more return on investment than Expat Czech. However, Coca Cola is 22.03 times more volatile than Expat Czech PX. It trades about 0.04 of its potential returns per unit of risk. Expat Czech PX is currently generating about 0.09 per unit of risk. If you would invest 800.00 in Coca Cola FEMSA SAB on September 2, 2024 and sell it today you would lose (75.00) from holding Coca Cola FEMSA SAB or give up 9.37% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coca Cola FEMSA SAB vs. Expat Czech PX
Performance |
| Timeline |
| Coca Cola FEMSA |
| Expat Czech PX |
Coca Cola and Expat Czech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and Expat Czech
The main advantage of trading using opposite Coca Cola and Expat Czech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, Expat Czech 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 Expat Czech will offset losses from the drop in Expat Czech's long position.| Coca Cola vs. Charter Communications | Coca Cola vs. International Consolidated Airlines | Coca Cola vs. Entravision Communications | Coca Cola vs. Computershare Limited |
| Expat Czech vs. Expat Croatia Crobex | Expat Czech vs. Expat Serbia Belex15 | Expat Czech vs. Expat Poland WIG20 | Expat Czech vs. Expat Slovenia SBI |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| CEOs Directory Screen CEOs from public companies around the world |