Correlation Between Coca Cola and IShares Thematic
Can any of the company-specific risk be diversified away by investing in both Coca Cola and IShares Thematic 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 IShares Thematic 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 iShares Thematic Rotation, you can compare the effects of market volatilities on Coca Cola and IShares Thematic 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 IShares Thematic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and IShares Thematic.
Diversification Opportunities for Coca Cola and IShares Thematic
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Coca and IShares is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding The Coca Cola and iShares Thematic Rotation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Thematic Rotation 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 IShares Thematic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Thematic Rotation has no effect on the direction of Coca Cola i.e., Coca Cola and IShares Thematic go up and down completely randomly.
Pair Corralation between Coca Cola and IShares Thematic
Allowing for the 90-day total investment horizon The Coca Cola is expected to generate 1.3 times more return on investment than IShares Thematic. However, Coca Cola is 1.3 times more volatile than iShares Thematic Rotation. It trades about 0.09 of its potential returns per unit of risk. iShares Thematic Rotation is currently generating about 0.1 per unit of risk. If you would invest 6,272 in The Coca Cola on September 13, 2024 and sell it today you would earn a total of 112.00 from holding The Coca Cola or generate 1.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Coca Cola vs. iShares Thematic Rotation
Performance |
| Timeline |
| Coca Cola |
| iShares Thematic Rotation |
Coca Cola and IShares Thematic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and IShares Thematic
The main advantage of trading using opposite Coca Cola and IShares Thematic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, IShares Thematic 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 IShares Thematic will offset losses from the drop in IShares Thematic'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 |
| IShares Thematic vs. Vanguard SP 500 | IShares Thematic vs. Vanguard Real Estate | IShares Thematic vs. Vanguard Total Bond | IShares Thematic vs. Vanguard High Dividend |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges |