Correlation Between Energia Latina and Coca Cola
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By analyzing existing cross correlation between Energia Latina SA and Coca Cola Embonor SA, you can compare the effects of market volatilities on Energia Latina 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 Energia Latina with a short position of Coca Cola. Check out your portfolio center. Please also check ongoing floating volatility patterns of Energia Latina and Coca Cola.
Diversification Opportunities for Energia Latina and Coca Cola
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Energia and Coca is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Energia Latina SA and Coca Cola Embonor SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coca Cola Embonor and Energia Latina 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 Energia Latina SA 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 Embonor has no effect on the direction of Energia Latina i.e., Energia Latina and Coca Cola go up and down completely randomly.
Pair Corralation between Energia Latina and Coca Cola
Assuming the 90 days trading horizon Energia Latina is expected to generate 2.2 times less return on investment than Coca Cola. But when comparing it to its historical volatility, Energia Latina SA is 2.96 times less risky than Coca Cola. It trades about 0.13 of its potential returns per unit of risk. Coca Cola Embonor SA is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 84,099 in Coca Cola Embonor SA on September 19, 2024 and sell it today you would earn a total of 37,811 from holding Coca Cola Embonor SA or generate 44.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 88.68% |
| Values | Daily Returns |
Energia Latina SA vs. Coca Cola Embonor SA
Performance |
| Timeline |
| Energia Latina SA |
| Coca Cola Embonor |
Energia Latina and Coca Cola Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Energia Latina and Coca Cola
The main advantage of trading using opposite Energia Latina and Coca Cola positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Energia Latina 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.| Energia Latina vs. Aguas Andinas SA | Energia Latina vs. Parq Arauco | Energia Latina vs. Enel Generacin Chile | Energia Latina vs. Sociedad Matriz SAAM |
| Coca Cola vs. Administradora Americana de | Coca Cola vs. Energia Latina SA | Coca Cola vs. Salfacorp | Coca Cola vs. Vina Concha To |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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