Correlation Between Mondelez International and Chocoladefabriken
Can any of the company-specific risk be diversified away by investing in both Mondelez International and Chocoladefabriken 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 Mondelez International and Chocoladefabriken into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mondelez International and Chocoladefabriken Lindt Sprngli, you can compare the effects of market volatilities on Mondelez International and Chocoladefabriken 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 Mondelez International with a short position of Chocoladefabriken. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mondelez International and Chocoladefabriken.
Diversification Opportunities for Mondelez International and Chocoladefabriken
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mondelez and Chocoladefabriken is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Mondelez International and Chocoladefabriken Lindt Sprngl in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chocoladefabriken Lindt and Mondelez International 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 Mondelez International are associated (or correlated) with Chocoladefabriken. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chocoladefabriken Lindt has no effect on the direction of Mondelez International i.e., Mondelez International and Chocoladefabriken go up and down completely randomly.
Pair Corralation between Mondelez International and Chocoladefabriken
Given the investment horizon of 90 days Mondelez International is expected to generate 0.83 times more return on investment than Chocoladefabriken. However, Mondelez International is 1.2 times less risky than Chocoladefabriken. It trades about -0.12 of its potential returns per unit of risk. Chocoladefabriken Lindt Sprngli is currently generating about -0.13 per unit of risk. If you would invest 7,080 in Mondelez International on August 28, 2024 and sell it today you would lose (586.00) from holding Mondelez International or give up 8.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mondelez International vs. Chocoladefabriken Lindt Sprngl
Performance |
| Timeline |
| Mondelez International |
| Chocoladefabriken Lindt |
Mondelez International and Chocoladefabriken Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mondelez International and Chocoladefabriken
The main advantage of trading using opposite Mondelez International and Chocoladefabriken positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mondelez International position performs unexpectedly, Chocoladefabriken 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 Chocoladefabriken will offset losses from the drop in Chocoladefabriken's long position.The idea behind Mondelez International and Chocoladefabriken Lindt Sprngli 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.
| Chocoladefabriken vs. Mondelez International | Chocoladefabriken vs. Tootsie Roll Industries | Chocoladefabriken vs. Rocky Mountain Chocolate | Chocoladefabriken vs. Barry Callebaut AG |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Stocks Directory Find actively traded stocks across global markets | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |