Correlation Between Monster Beverage and ESGEN Acquisition
Can any of the company-specific risk be diversified away by investing in both Monster Beverage and ESGEN Acquisition 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 Monster Beverage and ESGEN Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Monster Beverage Corp and ESGEN Acquisition Corp, you can compare the effects of market volatilities on Monster Beverage and ESGEN Acquisition 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 Monster Beverage with a short position of ESGEN Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Monster Beverage and ESGEN Acquisition.
Diversification Opportunities for Monster Beverage and ESGEN Acquisition
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Monster and ESGEN is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Monster Beverage Corp and ESGEN Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ESGEN Acquisition Corp and Monster Beverage 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 Monster Beverage Corp are associated (or correlated) with ESGEN Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ESGEN Acquisition Corp has no effect on the direction of Monster Beverage i.e., Monster Beverage and ESGEN Acquisition go up and down completely randomly.
Pair Corralation between Monster Beverage and ESGEN Acquisition
If you would invest 1,101 in ESGEN Acquisition Corp on September 13, 2024 and sell it today you would earn a total of 0.00 from holding ESGEN Acquisition Corp or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Monster Beverage Corp vs. ESGEN Acquisition Corp
Performance |
| Timeline |
| Monster Beverage Corp |
| ESGEN Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Monster Beverage and ESGEN Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Monster Beverage and ESGEN Acquisition
The main advantage of trading using opposite Monster Beverage and ESGEN Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monster Beverage position performs unexpectedly, ESGEN Acquisition 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 ESGEN Acquisition will offset losses from the drop in ESGEN Acquisition's long position.| Monster Beverage vs. Celsius Holdings | Monster Beverage vs. Coca Cola Femsa SAB | Monster Beverage vs. Keurig Dr Pepper | Monster Beverage vs. Embotelladora Andina SA |
| ESGEN Acquisition vs. JD Sports Fashion | ESGEN Acquisition vs. Brunswick | ESGEN Acquisition vs. Academy Sports Outdoors | ESGEN Acquisition vs. AerSale 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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