Correlation Between Coca Cola and TRANSCANADA
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By analyzing existing cross correlation between The Coca Cola and TRANSCANADA PIPELINES LTD, you can compare the effects of market volatilities on Coca Cola and TRANSCANADA 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 TRANSCANADA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and TRANSCANADA.
Diversification Opportunities for Coca Cola and TRANSCANADA
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Coca and TRANSCANADA is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding The Coca Cola and TRANSCANADA PIPELINES LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRANSCANADA PIPELINES LTD 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 TRANSCANADA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRANSCANADA PIPELINES LTD has no effect on the direction of Coca Cola i.e., Coca Cola and TRANSCANADA go up and down completely randomly.
Pair Corralation between Coca Cola and TRANSCANADA
Allowing for the 90-day total investment horizon The Coca Cola is expected to generate 0.69 times more return on investment than TRANSCANADA. However, The Coca Cola is 1.44 times less risky than TRANSCANADA. It trades about -0.09 of its potential returns per unit of risk. TRANSCANADA PIPELINES LTD is currently generating about -0.1 per unit of risk. If you would invest 6,556 in The Coca Cola on August 30, 2024 and sell it today you would lose (113.00) from holding The Coca Cola or give up 1.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 86.96% |
| Values | Daily Returns |
The Coca Cola vs. TRANSCANADA PIPELINES LTD
Performance |
| Timeline |
| Coca Cola |
| TRANSCANADA PIPELINES LTD |
Coca Cola and TRANSCANADA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and TRANSCANADA
The main advantage of trading using opposite Coca Cola and TRANSCANADA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, TRANSCANADA 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 TRANSCANADA will offset losses from the drop in TRANSCANADA's long position.| Coca Cola vs. Celsius Holdings | Coca Cola vs. Coca Cola Consolidated | Coca Cola vs. Keurig Dr Pepper | Coca Cola vs. PepsiCo |
| TRANSCANADA vs. AEP TEX INC | TRANSCANADA vs. US BANK NATIONAL | TRANSCANADA vs. Nasdaq Inc | TRANSCANADA vs. Vertiv Holdings Co |
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 CEOs Directory module to screen CEOs from public companies around the world.
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