Correlation Between Coca Cola and Citrine Global
Can any of the company-specific risk be diversified away by investing in both Coca Cola and Citrine Global 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 Citrine Global 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 Citrine Global Corp, you can compare the effects of market volatilities on Coca Cola and Citrine Global 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 Citrine Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and Citrine Global.
Diversification Opportunities for Coca Cola and Citrine Global
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Coca and Citrine is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding The Coca Cola and Citrine Global Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citrine Global Corp 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 Citrine Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citrine Global Corp has no effect on the direction of Coca Cola i.e., Coca Cola and Citrine Global go up and down completely randomly.
Pair Corralation between Coca Cola and Citrine Global
Allowing for the 90-day total investment horizon The Coca Cola is expected to generate 0.11 times more return on investment than Citrine Global. However, The Coca Cola is 9.32 times less risky than Citrine Global. It trades about -0.21 of its potential returns per unit of risk. Citrine Global Corp is currently generating about -0.18 per unit of risk. If you would invest 7,197 in The Coca Cola on September 2, 2024 and sell it today you would lose (789.00) from holding The Coca Cola or give up 10.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.46% |
| Values | Daily Returns |
The Coca Cola vs. Citrine Global Corp
Performance |
| Timeline |
| Coca Cola |
| Citrine Global Corp |
Coca Cola and Citrine Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and Citrine Global
The main advantage of trading using opposite Coca Cola and Citrine Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, Citrine Global 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 Citrine Global will offset losses from the drop in Citrine Global's long position.| Coca Cola vs. Monster Beverage Corp | Coca Cola vs. Celsius Holdings | Coca Cola vs. Coca Cola Consolidated | Coca Cola vs. Keurig Dr Pepper |
| Citrine Global vs. Mills Music Trust | Citrine Global vs. Blue Water Ventures | Citrine Global vs. DATA Communications Management | Citrine Global vs. Mitie Group 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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