Correlation Between Molson Coors and Hanover Insurance
Can any of the company-specific risk be diversified away by investing in both Molson Coors and Hanover Insurance 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 Molson Coors and Hanover Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Molson Coors Brewing and The Hanover Insurance, you can compare the effects of market volatilities on Molson Coors and Hanover Insurance 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 Molson Coors with a short position of Hanover Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Molson Coors and Hanover Insurance.
Diversification Opportunities for Molson Coors and Hanover Insurance
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Molson and Hanover is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Molson Coors Brewing and The Hanover Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanover Insurance and Molson Coors 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 Molson Coors Brewing are associated (or correlated) with Hanover Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanover Insurance has no effect on the direction of Molson Coors i.e., Molson Coors and Hanover Insurance go up and down completely randomly.
Pair Corralation between Molson Coors and Hanover Insurance
Assuming the 90 days horizon Molson Coors Brewing is expected to generate 1.13 times more return on investment than Hanover Insurance. However, Molson Coors is 1.13 times more volatile than The Hanover Insurance. It trades about 0.26 of its potential returns per unit of risk. The Hanover Insurance is currently generating about 0.27 per unit of risk. If you would invest 5,152 in Molson Coors Brewing on August 25, 2024 and sell it today you would earn a total of 584.00 from holding Molson Coors Brewing or generate 11.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Molson Coors Brewing vs. The Hanover Insurance
Performance |
| Timeline |
| Molson Coors Brewing |
| Hanover Insurance |
Molson Coors and Hanover Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Molson Coors and Hanover Insurance
The main advantage of trading using opposite Molson Coors and Hanover Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Molson Coors position performs unexpectedly, Hanover Insurance 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 Hanover Insurance will offset losses from the drop in Hanover Insurance's long position.| Molson Coors vs. The Hanover Insurance | Molson Coors vs. SOFTBANK P ADR | Molson Coors vs. GREENX METALS LTD | Molson Coors vs. VIRG NATL BANKSH |
| Hanover Insurance vs. The Peoples Insurance | Hanover Insurance vs. W R Berkley | Hanover Insurance vs. Loews 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |