Correlation Between MOLSON COORS and Origin Agritech
Can any of the company-specific risk be diversified away by investing in both MOLSON COORS and Origin Agritech 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 Origin Agritech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MOLSON RS BEVERAGE and Origin Agritech, you can compare the effects of market volatilities on MOLSON COORS and Origin Agritech 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 Origin Agritech. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOLSON COORS and Origin Agritech.
Diversification Opportunities for MOLSON COORS and Origin Agritech
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MOLSON and Origin is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding MOLSON RS BEVERAGE and Origin Agritech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Origin Agritech 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 RS BEVERAGE are associated (or correlated) with Origin Agritech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Origin Agritech has no effect on the direction of MOLSON COORS i.e., MOLSON COORS and Origin Agritech go up and down completely randomly.
Pair Corralation between MOLSON COORS and Origin Agritech
Assuming the 90 days trading horizon MOLSON COORS is expected to generate 17.87 times less return on investment than Origin Agritech. But when comparing it to its historical volatility, MOLSON RS BEVERAGE is 3.05 times less risky than Origin Agritech. It trades about 0.01 of its potential returns per unit of risk. Origin Agritech is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 182.00 in Origin Agritech on September 3, 2024 and sell it today you would earn a total of 60.00 from holding Origin Agritech or generate 32.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MOLSON RS BEVERAGE vs. Origin Agritech
Performance |
| Timeline |
| MOLSON RS BEVERAGE |
| Origin Agritech |
MOLSON COORS and Origin Agritech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MOLSON COORS and Origin Agritech
The main advantage of trading using opposite MOLSON COORS and Origin Agritech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MOLSON COORS position performs unexpectedly, Origin Agritech 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 Origin Agritech will offset losses from the drop in Origin Agritech's long position.| MOLSON COORS vs. Anheuser Busch InBev SANV | MOLSON COORS vs. China Resources Beer | MOLSON COORS vs. Royal Unibrew AS |
| Origin Agritech vs. Gamma Communications plc | Origin Agritech vs. Chunghwa Telecom Co | Origin Agritech vs. Citic Telecom International | Origin Agritech vs. Ribbon Communications |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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