Correlation Between Chart Industries and Monster Beverage
Can any of the company-specific risk be diversified away by investing in both Chart Industries and Monster Beverage 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 Chart Industries and Monster Beverage into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chart Industries and Monster Beverage Corp, you can compare the effects of market volatilities on Chart Industries and Monster Beverage 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 Chart Industries with a short position of Monster Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chart Industries and Monster Beverage.
Diversification Opportunities for Chart Industries and Monster Beverage
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Chart and Monster is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Chart Industries and Monster Beverage Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Monster Beverage Corp and Chart Industries 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 Chart Industries are associated (or correlated) with Monster Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Monster Beverage Corp has no effect on the direction of Chart Industries i.e., Chart Industries and Monster Beverage go up and down completely randomly.
Pair Corralation between Chart Industries and Monster Beverage
Given the investment horizon of 90 days Chart Industries is expected to generate 2.12 times more return on investment than Monster Beverage. However, Chart Industries is 2.12 times more volatile than Monster Beverage Corp. It trades about 0.07 of its potential returns per unit of risk. Monster Beverage Corp is currently generating about 0.0 per unit of risk. If you would invest 12,663 in Chart Industries on September 4, 2024 and sell it today you would earn a total of 6,727 from holding Chart Industries or generate 53.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chart Industries vs. Monster Beverage Corp
Performance |
| Timeline |
| Chart Industries |
| Monster Beverage Corp |
Chart Industries and Monster Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chart Industries and Monster Beverage
The main advantage of trading using opposite Chart Industries and Monster Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chart Industries position performs unexpectedly, Monster Beverage 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 Monster Beverage will offset losses from the drop in Monster Beverage's long position.| Chart Industries vs. Crane NXT Co | Chart Industries vs. Donaldson | Chart Industries vs. ITT Inc | Chart Industries vs. Franklin Electric Co |
| Monster Beverage vs. Vita Coco | Monster Beverage vs. PepsiCo | Monster Beverage vs. The Coca Cola | Monster Beverage vs. Coca Cola Femsa SAB |
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.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |