Correlation Between Coca Cola and PROCTER
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By analyzing existing cross correlation between The Coca Cola and PROCTER GAMBLE 35, you can compare the effects of market volatilities on Coca Cola and PROCTER 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 PROCTER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and PROCTER.
Diversification Opportunities for Coca Cola and PROCTER
Good diversification
The 3 months correlation between Coca and PROCTER is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding The Coca Cola and PROCTER GAMBLE 35 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PROCTER GAMBLE 35 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 PROCTER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PROCTER GAMBLE 35 has no effect on the direction of Coca Cola i.e., Coca Cola and PROCTER go up and down completely randomly.
Pair Corralation between Coca Cola and PROCTER
Allowing for the 90-day total investment horizon The Coca Cola is expected to generate 0.29 times more return on investment than PROCTER. However, The Coca Cola is 3.47 times less risky than PROCTER. It trades about 0.02 of its potential returns per unit of risk. PROCTER GAMBLE 35 is currently generating about 0.0 per unit of risk. If you would invest 6,013 in The Coca Cola on August 27, 2024 and sell it today you would earn a total of 379.00 from holding The Coca Cola or generate 6.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 36.29% |
| Values | Daily Returns |
The Coca Cola vs. PROCTER GAMBLE 35
Performance |
| Timeline |
| Coca Cola |
| PROCTER GAMBLE 35 |
Coca Cola and PROCTER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and PROCTER
The main advantage of trading using opposite Coca Cola and PROCTER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, PROCTER 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 PROCTER will offset losses from the drop in PROCTER's long position.The idea behind The Coca Cola and PROCTER GAMBLE 35 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| PROCTER vs. The Coca Cola | PROCTER vs. JPMorgan Chase Co | PROCTER vs. Dupont De Nemours | PROCTER vs. Alcoa Corp |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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