Correlation Between CPI Computer and Coca Cola
Can any of the company-specific risk be diversified away by investing in both CPI Computer 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 CPI Computer and Coca Cola into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CPI Computer Peripherals and Coca Cola HBC AG, you can compare the effects of market volatilities on CPI Computer 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 CPI Computer with a short position of Coca Cola. Check out your portfolio center. Please also check ongoing floating volatility patterns of CPI Computer and Coca Cola.
Diversification Opportunities for CPI Computer and Coca Cola
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CPI and Coca is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding CPI Computer Peripherals and Coca Cola HBC AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coca Cola HBC and CPI Computer 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 CPI Computer Peripherals 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 HBC has no effect on the direction of CPI Computer i.e., CPI Computer and Coca Cola go up and down completely randomly.
Pair Corralation between CPI Computer and Coca Cola
Assuming the 90 days trading horizon CPI Computer Peripherals is expected to under-perform the Coca Cola. In addition to that, CPI Computer is 1.82 times more volatile than Coca Cola HBC AG. It trades about -0.16 of its total potential returns per unit of risk. Coca Cola HBC AG is currently generating about 0.15 per unit of volatility. If you would invest 3,262 in Coca Cola HBC AG on August 28, 2024 and sell it today you would earn a total of 120.00 from holding Coca Cola HBC AG or generate 3.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CPI Computer Peripherals vs. Coca Cola HBC AG
Performance |
| Timeline |
| CPI Computer Peripherals |
| Coca Cola HBC |
CPI Computer and Coca Cola Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CPI Computer and Coca Cola
The main advantage of trading using opposite CPI Computer and Coca Cola positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CPI Computer 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.| CPI Computer vs. Performance Technologies SA | CPI Computer vs. National Bank of | CPI Computer vs. EL D Mouzakis | CPI Computer vs. Lampsa Hellenic Hotels |
| Coca Cola vs. National Bank of | Coca Cola vs. N Leventeris SA | Coca Cola vs. Eurobank Ergasias Services | Coca Cola vs. Vogiatzoglou Systems SA |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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