Correlation Between Coca Cola and OS Therapies
Can any of the company-specific risk be diversified away by investing in both Coca Cola and OS Therapies 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 OS Therapies 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 OS Therapies Incorporated, you can compare the effects of market volatilities on Coca Cola and OS Therapies 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 OS Therapies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and OS Therapies.
Diversification Opportunities for Coca Cola and OS Therapies
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Coca and OSTX is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding The Coca Cola and OS Therapies Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OS Therapies 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 OS Therapies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OS Therapies has no effect on the direction of Coca Cola i.e., Coca Cola and OS Therapies go up and down completely randomly.
Pair Corralation between Coca Cola and OS Therapies
Allowing for the 90-day total investment horizon The Coca Cola is expected to generate 0.13 times more return on investment than OS Therapies. However, The Coca Cola is 7.9 times less risky than OS Therapies. It trades about 0.15 of its potential returns per unit of risk. OS Therapies Incorporated is currently generating about -0.37 per unit of risk. If you would invest 6,084 in The Coca Cola on November 8, 2024 and sell it today you would earn a total of 228.00 from holding The Coca Cola or generate 3.75% 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. OS Therapies Incorporated
Performance |
| Timeline |
| Coca Cola |
| OS Therapies |
Coca Cola and OS Therapies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and OS Therapies
The main advantage of trading using opposite Coca Cola and OS Therapies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, OS Therapies 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 OS Therapies will offset losses from the drop in OS Therapies' 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 |
| OS Therapies vs. China Southern Airlines | OS Therapies vs. Merit Medical Systems | OS Therapies vs. El Al Israel | OS Therapies vs. Frontier Group Holdings |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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