Correlation Between Heineken and Heineken Holding
Can any of the company-specific risk be diversified away by investing in both Heineken and Heineken Holding 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 Heineken and Heineken Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Heineken NV and Heineken Holding NV, you can compare the effects of market volatilities on Heineken and Heineken Holding 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 Heineken with a short position of Heineken Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heineken and Heineken Holding.
Diversification Opportunities for Heineken and Heineken Holding
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Heineken and Heineken is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Heineken NV and Heineken Holding NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Heineken Holding and Heineken 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 Heineken NV are associated (or correlated) with Heineken Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Heineken Holding has no effect on the direction of Heineken i.e., Heineken and Heineken Holding go up and down completely randomly.
Pair Corralation between Heineken and Heineken Holding
Assuming the 90 days horizon Heineken NV is expected to under-perform the Heineken Holding. But the otc stock apears to be less risky and, when comparing its historical volatility, Heineken NV is 1.12 times less risky than Heineken Holding. The otc stock trades about -0.27 of its potential returns per unit of risk. The Heineken Holding NV is currently generating about -0.2 of returns per unit of risk over similar time horizon. If you would invest 3,780 in Heineken Holding NV on August 28, 2024 and sell it today you would lose (607.00) from holding Heineken Holding NV or give up 16.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heineken NV vs. Heineken Holding NV
Performance |
| Timeline |
| Heineken NV |
| Heineken Holding |
Heineken and Heineken Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heineken and Heineken Holding
The main advantage of trading using opposite Heineken and Heineken Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heineken position performs unexpectedly, Heineken Holding 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 Heineken Holding will offset losses from the drop in Heineken Holding's long position.| Heineken vs. Anheuser Busch InBev SANV | Heineken vs. Tsingtao Brewery Co | Heineken vs. Carlsberg AS | Heineken vs. Heineken Holding NV |
| Heineken Holding vs. Barfresh Food Group | Heineken Holding vs. Fbec Worldwide | Heineken Holding vs. Flow Beverage Corp | Heineken Holding vs. Eq Energy Drink |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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