Correlation Between Coca Cola and WisdomTree
Can any of the company-specific risk be diversified away by investing in both Coca Cola and WisdomTree 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 WisdomTree 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 WisdomTree, you can compare the effects of market volatilities on Coca Cola and WisdomTree 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 WisdomTree. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and WisdomTree.
Diversification Opportunities for Coca Cola and WisdomTree
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Coca and WisdomTree is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding The Coca Cola and WisdomTree in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WisdomTree 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 WisdomTree. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WisdomTree has no effect on the direction of Coca Cola i.e., Coca Cola and WisdomTree go up and down completely randomly.
Pair Corralation between Coca Cola and WisdomTree
If you would invest 1,094 in WisdomTree on August 31, 2024 and sell it today you would earn a total of 0.00 from holding WisdomTree or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 4.55% |
| Values | Daily Returns |
The Coca Cola vs. WisdomTree
Performance |
| Timeline |
| Coca Cola |
| WisdomTree |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Coca Cola and WisdomTree Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and WisdomTree
The main advantage of trading using opposite Coca Cola and WisdomTree positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, WisdomTree 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 WisdomTree will offset losses from the drop in WisdomTree's long position.| Coca Cola vs. Monster Beverage Corp | Coca Cola vs. RLJ Lodging Trust | Coca Cola vs. Aquagold International | Coca Cola vs. Stepstone Group |
| WisdomTree vs. Blackrock Floating Rate | WisdomTree vs. Eaton Vance Senior | WisdomTree vs. Eaton Vance Senior | WisdomTree vs. Blackrock Debt Strategies |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |