Correlation Between Molson Coors and Glaston Oyj
Can any of the company-specific risk be diversified away by investing in both Molson Coors and Glaston Oyj 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 Glaston Oyj into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Molson Coors Beverage and Glaston Oyj Abp, you can compare the effects of market volatilities on Molson Coors and Glaston Oyj 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 Glaston Oyj. Check out your portfolio center. Please also check ongoing floating volatility patterns of Molson Coors and Glaston Oyj.
Diversification Opportunities for Molson Coors and Glaston Oyj
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Molson and Glaston is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Molson Coors Beverage and Glaston Oyj Abp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Glaston Oyj Abp 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 Beverage are associated (or correlated) with Glaston Oyj. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Glaston Oyj Abp has no effect on the direction of Molson Coors i.e., Molson Coors and Glaston Oyj go up and down completely randomly.
Pair Corralation between Molson Coors and Glaston Oyj
Assuming the 90 days trading horizon Molson Coors Beverage is expected to generate 0.64 times more return on investment than Glaston Oyj. However, Molson Coors Beverage is 1.55 times less risky than Glaston Oyj. It trades about 0.13 of its potential returns per unit of risk. Glaston Oyj Abp is currently generating about -0.04 per unit of risk. If you would invest 4,580 in Molson Coors Beverage on September 12, 2024 and sell it today you would earn a total of 1,246 from holding Molson Coors Beverage or generate 27.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.22% |
| Values | Daily Returns |
Molson Coors Beverage vs. Glaston Oyj Abp
Performance |
| Timeline |
| Molson Coors Beverage |
| Glaston Oyj Abp |
Molson Coors and Glaston Oyj Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Molson Coors and Glaston Oyj
The main advantage of trading using opposite Molson Coors and Glaston Oyj positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Molson Coors position performs unexpectedly, Glaston Oyj 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 Glaston Oyj will offset losses from the drop in Glaston Oyj's long position.The idea behind Molson Coors Beverage and Glaston Oyj Abp 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.| Glaston Oyj vs. SIEMENS AG SP | Glaston Oyj vs. Siemens Aktiengesellschaft | Glaston Oyj vs. Siemens Aktiengesellschaft | Glaston Oyj vs. Schneider Electric SE |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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