Correlation Between Coca Cola and Aluar Aluminio
Can any of the company-specific risk be diversified away by investing in both Coca Cola and Aluar Aluminio 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 Coca Cola and Aluar Aluminio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Coca Cola and Aluar Aluminio Argentino, you can compare the effects of market volatilities on Coca Cola and Aluar Aluminio 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 Coca Cola with a short position of Aluar Aluminio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and Aluar Aluminio.
Diversification Opportunities for Coca Cola and Aluar Aluminio
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Coca and Aluar is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding The Coca Cola and Aluar Aluminio Argentino in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aluar Aluminio Argentino and Coca Cola 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 The Coca Cola are associated (or correlated) with Aluar Aluminio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aluar Aluminio Argentino has no effect on the direction of Coca Cola i.e., Coca Cola and Aluar Aluminio go up and down completely randomly.
Pair Corralation between Coca Cola and Aluar Aluminio
Assuming the 90 days horizon The Coca Cola is expected to generate 0.58 times more return on investment than Aluar Aluminio. However, The Coca Cola is 1.74 times less risky than Aluar Aluminio. It trades about 0.13 of its potential returns per unit of risk. Aluar Aluminio Argentino is currently generating about -0.06 per unit of risk. If you would invest 1,455,000 in The Coca Cola on November 2, 2024 and sell it today you would earn a total of 55,000 from holding The Coca Cola or generate 3.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Coca Cola vs. Aluar Aluminio Argentino
Performance |
| Timeline |
| Coca Cola |
| Aluar Aluminio Argentino |
Coca Cola and Aluar Aluminio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and Aluar Aluminio
The main advantage of trading using opposite Coca Cola and Aluar Aluminio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, Aluar Aluminio 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 Aluar Aluminio will offset losses from the drop in Aluar Aluminio's long position.| Coca Cola vs. Grimoldi SA | Coca Cola vs. Transportadora de Gas | Coca Cola vs. Alphabet Inc Class A CEDEAR | Coca Cola vs. International Business Machines |
| Aluar Aluminio vs. Grimoldi SA | Aluar Aluminio vs. Transportadora de Gas | Aluar Aluminio vs. Agrometal SAI | Aluar Aluminio vs. Alphabet Inc Class A CEDEAR |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum |