Correlation Between Coca Cola and Ledesma SAAI
Can any of the company-specific risk be diversified away by investing in both Coca Cola and Ledesma SAAI 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 Ledesma SAAI 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 Ledesma SAAI, you can compare the effects of market volatilities on Coca Cola and Ledesma SAAI 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 Ledesma SAAI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and Ledesma SAAI.
Diversification Opportunities for Coca Cola and Ledesma SAAI
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Coca and Ledesma is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding The Coca Cola and Ledesma SAAI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ledesma SAAI 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 Ledesma SAAI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ledesma SAAI has no effect on the direction of Coca Cola i.e., Coca Cola and Ledesma SAAI go up and down completely randomly.
Pair Corralation between Coca Cola and Ledesma SAAI
Assuming the 90 days horizon The Coca Cola is expected to generate 0.49 times more return on investment than Ledesma SAAI. However, The Coca Cola is 2.04 times less risky than Ledesma SAAI. It trades about 0.16 of its potential returns per unit of risk. Ledesma SAAI is currently generating about -0.08 per unit of risk. If you would invest 1,450,000 in The Coca Cola on October 20, 2024 and sell it today you would earn a total of 40,000 from holding The Coca Cola or generate 2.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Coca Cola vs. Ledesma SAAI
Performance |
| Timeline |
| Coca Cola |
| Ledesma SAAI |
Coca Cola and Ledesma SAAI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and Ledesma SAAI
The main advantage of trading using opposite Coca Cola and Ledesma SAAI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, Ledesma SAAI 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 Ledesma SAAI will offset losses from the drop in Ledesma SAAI's long position.| Coca Cola vs. American Express Co | Coca Cola vs. Ledesma SAAI | Coca Cola vs. Central Puerto SA | Coca Cola vs. Aluar Aluminio Argentino |
| Ledesma SAAI vs. Molinos Agro SA | Ledesma SAAI vs. Cresud SA | Ledesma SAAI vs. San Miguel AG | Ledesma SAAI vs. Inversora Juramento SA |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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