Correlation Between Coca Cola and WELLPOINT
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By analyzing existing cross correlation between The Coca Cola and WELLPOINT INC 465, you can compare the effects of market volatilities on Coca Cola and WELLPOINT 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 WELLPOINT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and WELLPOINT.
Diversification Opportunities for Coca Cola and WELLPOINT
Weak diversification
The 3 months correlation between Coca and WELLPOINT is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding The Coca Cola and WELLPOINT INC 465 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WELLPOINT INC 465 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 WELLPOINT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WELLPOINT INC 465 has no effect on the direction of Coca Cola i.e., Coca Cola and WELLPOINT go up and down completely randomly.
Pair Corralation between Coca Cola and WELLPOINT
Allowing for the 90-day total investment horizon The Coca Cola is expected to generate 0.88 times more return on investment than WELLPOINT. However, The Coca Cola is 1.13 times less risky than WELLPOINT. It trades about 0.27 of its potential returns per unit of risk. WELLPOINT INC 465 is currently generating about 0.17 per unit of risk. If you would invest 6,203 in The Coca Cola on November 30, 2024 and sell it today you would earn a total of 918.00 from holding The Coca Cola or generate 14.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.62% |
| Values | Daily Returns |
The Coca Cola vs. WELLPOINT INC 465
Performance |
| Timeline |
| Coca Cola |
| WELLPOINT INC 465 |
Coca Cola and WELLPOINT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and WELLPOINT
The main advantage of trading using opposite Coca Cola and WELLPOINT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, WELLPOINT 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 WELLPOINT will offset losses from the drop in WELLPOINT's long position.| Coca Cola vs. Vita Coco | Coca Cola vs. Keurig Dr Pepper | Coca Cola vs. PepsiCo | Coca Cola vs. Coca Cola Femsa SAB |
| WELLPOINT vs. Hurco Companies | WELLPOINT vs. Cementos Pacasmayo SAA | WELLPOINT vs. Sun Country Airlines | WELLPOINT vs. Griffon |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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