Correlation Between Heineken Holding and Remy Cointreau
Can any of the company-specific risk be diversified away by investing in both Heineken Holding and Remy Cointreau 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 Holding and Remy Cointreau into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Heineken Holding NV and Remy Cointreau SA, you can compare the effects of market volatilities on Heineken Holding and Remy Cointreau 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 Holding with a short position of Remy Cointreau. Check out your portfolio center. Please also check ongoing floating volatility patterns of Heineken Holding and Remy Cointreau.
Diversification Opportunities for Heineken Holding and Remy Cointreau
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Heineken and Remy is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Heineken Holding NV and Remy Cointreau SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Remy Cointreau SA and Heineken Holding 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 Holding NV are associated (or correlated) with Remy Cointreau. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Remy Cointreau SA has no effect on the direction of Heineken Holding i.e., Heineken Holding and Remy Cointreau go up and down completely randomly.
Pair Corralation between Heineken Holding and Remy Cointreau
Assuming the 90 days horizon Heineken Holding NV is expected to under-perform the Remy Cointreau. But the otc stock apears to be less risky and, when comparing its historical volatility, Heineken Holding NV is 1.71 times less risky than Remy Cointreau. The otc stock trades about -0.18 of its potential returns per unit of risk. The Remy Cointreau SA is currently generating about 0.47 of returns per unit of risk over similar time horizon. If you would invest 564.00 in Remy Cointreau SA on September 14, 2024 and sell it today you would earn a total of 111.00 from holding Remy Cointreau SA or generate 19.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Heineken Holding NV vs. Remy Cointreau SA
Performance |
| Timeline |
| Heineken Holding |
| Remy Cointreau SA |
Heineken Holding and Remy Cointreau Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Heineken Holding and Remy Cointreau
The main advantage of trading using opposite Heineken Holding and Remy Cointreau positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Heineken Holding position performs unexpectedly, Remy Cointreau 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 Remy Cointreau will offset losses from the drop in Remy Cointreau's long position.| Heineken Holding vs. Anheuser Busch InBev SANV | Heineken Holding vs. Anheuser Busch Inbev | Heineken Holding vs. Molson Coors Brewing | Heineken Holding vs. Heineken NV |
| Remy Cointreau vs. Andrew Peller Limited | Remy Cointreau vs. Aristocrat Group Corp | Remy Cointreau vs. Iconic Brands | Remy Cointreau vs. Naked Wines plc |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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