Correlation Between Coca Cola and Franklin Exponential
Can any of the company-specific risk be diversified away by investing in both Coca Cola and Franklin Exponential 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 Franklin Exponential 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 Franklin Exponential Data, you can compare the effects of market volatilities on Coca Cola and Franklin Exponential 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 Franklin Exponential. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and Franklin Exponential.
Diversification Opportunities for Coca Cola and Franklin Exponential
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Coca and Franklin is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding The Coca Cola and Franklin Exponential Data in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Exponential Data 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 Franklin Exponential. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Exponential Data has no effect on the direction of Coca Cola i.e., Coca Cola and Franklin Exponential go up and down completely randomly.
Pair Corralation between Coca Cola and Franklin Exponential
Allowing for the 90-day total investment horizon The Coca Cola is expected to under-perform the Franklin Exponential. But the stock apears to be less risky and, when comparing its historical volatility, The Coca Cola is 1.42 times less risky than Franklin Exponential. The stock trades about -0.12 of its potential returns per unit of risk. The Franklin Exponential Data is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 2,450 in Franklin Exponential Data on August 29, 2024 and sell it today you would earn a total of 242.00 from holding Franklin Exponential Data or generate 9.88% 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. Franklin Exponential Data
Performance |
| Timeline |
| Coca Cola |
| Franklin Exponential Data |
Coca Cola and Franklin Exponential Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coca Cola and Franklin Exponential
The main advantage of trading using opposite Coca Cola and Franklin Exponential positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, Franklin Exponential 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 Franklin Exponential will offset losses from the drop in Franklin Exponential's long position.| Coca Cola vs. Celsius Holdings | Coca Cola vs. Coca Cola European Partners | Coca Cola vs. Capital Income Builder | Coca Cola vs. Direxion Daily FTSE |
| Franklin Exponential vs. Franklin Disruptive Commerce | Franklin Exponential vs. Franklin Templeton ETF | Franklin Exponential vs. Esoterica NextG Economy | Franklin Exponential vs. TrueShares Technology AI |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |