Correlation Between Coca Cola and KULR Technology
Can any of the company-specific risk be diversified away by investing in both Coca Cola and KULR Technology 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 KULR Technology 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 KULR Technology Group, you can compare the effects of market volatilities on Coca Cola and KULR Technology 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 KULR Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and KULR Technology.
Diversification Opportunities for Coca Cola and KULR Technology
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Coca and KULR is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding The Coca Cola and KULR Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KULR Technology Group 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 KULR Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KULR Technology Group has no effect on the direction of Coca Cola i.e., Coca Cola and KULR Technology go up and down completely randomly.
Pair Corralation between Coca Cola and KULR Technology
Allowing for the 90-day total investment horizon The Coca Cola is expected to under-perform the KULR Technology. But the stock apears to be less risky and, when comparing its historical volatility, The Coca Cola is 20.14 times less risky than KULR Technology. The stock trades about -0.17 of its potential returns per unit of risk. The KULR Technology Group is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 30.00 in KULR Technology Group on August 28, 2024 and sell it today you would earn a total of 49.00 from holding KULR Technology Group or generate 163.33% 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. KULR Technology Group
Performance |
| Timeline |
| Coca Cola |
| KULR Technology Group |
Coca Cola and KULR Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and KULR Technology
The main advantage of trading using opposite Coca Cola and KULR Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, KULR Technology 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 KULR Technology will offset losses from the drop in KULR Technology'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 |
| KULR Technology vs. Richardson Electronics | KULR Technology vs. Interlink Electronics | KULR Technology vs. SigmaTron International | KULR Technology vs. Maris Tech |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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