Correlation Between Coca Cola and Horizon Kinetics
Can any of the company-specific risk be diversified away by investing in both Coca Cola and Horizon Kinetics 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 Horizon Kinetics 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 Horizon Kinetics SPAC, you can compare the effects of market volatilities on Coca Cola and Horizon Kinetics 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 Horizon Kinetics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and Horizon Kinetics.
Diversification Opportunities for Coca Cola and Horizon Kinetics
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Coca and Horizon is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding The Coca Cola and Horizon Kinetics SPAC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Horizon Kinetics SPAC 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 Horizon Kinetics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Horizon Kinetics SPAC has no effect on the direction of Coca Cola i.e., Coca Cola and Horizon Kinetics go up and down completely randomly.
Pair Corralation between Coca Cola and Horizon Kinetics
Allowing for the 90-day total investment horizon The Coca Cola is expected to under-perform the Horizon Kinetics. In addition to that, Coca Cola is 1.28 times more volatile than Horizon Kinetics SPAC. It trades about -0.14 of its total potential returns per unit of risk. Horizon Kinetics SPAC is currently generating about 0.03 per unit of volatility. If you would invest 9,931 in Horizon Kinetics SPAC on August 23, 2024 and sell it today you would earn a total of 108.00 from holding Horizon Kinetics SPAC or generate 1.09% 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. Horizon Kinetics SPAC
Performance |
| Timeline |
| Coca Cola |
| Horizon Kinetics SPAC |
Coca Cola and Horizon Kinetics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and Horizon Kinetics
The main advantage of trading using opposite Coca Cola and Horizon Kinetics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, Horizon Kinetics 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 Horizon Kinetics will offset losses from the drop in Horizon Kinetics' long position.| Coca Cola vs. Monster Beverage Corp | Coca Cola vs. Celsius Holdings | Coca Cola vs. Coca Cola Femsa SAB | Coca Cola vs. Vita Coco |
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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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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