Correlation Between MOLSON COORS and AM EAGLE
Can any of the company-specific risk be diversified away by investing in both MOLSON COORS and AM EAGLE 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 AM EAGLE 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 AM EAGLE OUTFITTERS, you can compare the effects of market volatilities on MOLSON COORS and AM EAGLE 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 AM EAGLE. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOLSON COORS and AM EAGLE.
Diversification Opportunities for MOLSON COORS and AM EAGLE
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MOLSON and AFG is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding MOLSON RS BEVERAGE and AM EAGLE OUTFITTERS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AM EAGLE OUTFITTERS 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 AM EAGLE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AM EAGLE OUTFITTERS has no effect on the direction of MOLSON COORS i.e., MOLSON COORS and AM EAGLE go up and down completely randomly.
Pair Corralation between MOLSON COORS and AM EAGLE
Assuming the 90 days trading horizon MOLSON RS BEVERAGE is expected to under-perform the AM EAGLE. But the stock apears to be less risky and, when comparing its historical volatility, MOLSON RS BEVERAGE is 1.04 times less risky than AM EAGLE. The stock trades about -0.01 of its potential returns per unit of risk. The AM EAGLE OUTFITTERS is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,340 in AM EAGLE OUTFITTERS on October 16, 2024 and sell it today you would earn a total of 190.00 from holding AM EAGLE OUTFITTERS or generate 14.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MOLSON RS BEVERAGE vs. AM EAGLE OUTFITTERS
Performance |
| Timeline |
| MOLSON RS BEVERAGE |
| AM EAGLE OUTFITTERS |
MOLSON COORS and AM EAGLE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MOLSON COORS and AM EAGLE
The main advantage of trading using opposite MOLSON COORS and AM EAGLE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MOLSON COORS position performs unexpectedly, AM EAGLE 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 AM EAGLE will offset losses from the drop in AM EAGLE's long position.| MOLSON COORS vs. SBM OFFSHORE | MOLSON COORS vs. BW OFFSHORE LTD | MOLSON COORS vs. Easy Software AG | MOLSON COORS vs. Casio Computer CoLtd |
| AM EAGLE vs. CarsalesCom | AM EAGLE vs. Tsingtao Brewery | AM EAGLE vs. Grupo Carso SAB | AM EAGLE vs. MOLSON RS BEVERAGE |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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