Correlation Between MOLSON RS and Air Liquide
Can any of the company-specific risk be diversified away by investing in both MOLSON RS and Air Liquide 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 RS and Air Liquide 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 Air Liquide SA, you can compare the effects of market volatilities on MOLSON RS and Air Liquide 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 RS with a short position of Air Liquide. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOLSON RS and Air Liquide.
Diversification Opportunities for MOLSON RS and Air Liquide
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MOLSON and Air is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding MOLSON RS BEVERAGE and Air Liquide SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Liquide SA and MOLSON RS 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 Air Liquide. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Liquide SA has no effect on the direction of MOLSON RS i.e., MOLSON RS and Air Liquide go up and down completely randomly.
Pair Corralation between MOLSON RS and Air Liquide
Assuming the 90 days trading horizon MOLSON RS BEVERAGE is expected to under-perform the Air Liquide. In addition to that, MOLSON RS is 2.11 times more volatile than Air Liquide SA. It trades about -0.03 of its total potential returns per unit of risk. Air Liquide SA is currently generating about 0.35 per unit of volatility. If you would invest 15,500 in Air Liquide SA on October 31, 2024 and sell it today you would earn a total of 1,188 from holding Air Liquide SA or generate 7.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
MOLSON RS BEVERAGE vs. Air Liquide SA
Performance |
| Timeline |
| MOLSON RS BEVERAGE |
| Air Liquide SA |
MOLSON RS and Air Liquide Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MOLSON RS and Air Liquide
The main advantage of trading using opposite MOLSON RS and Air Liquide positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MOLSON RS position performs unexpectedly, Air Liquide 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 Air Liquide will offset losses from the drop in Air Liquide's long position.| MOLSON RS vs. GALENA MINING LTD | MOLSON RS vs. United Utilities Group | MOLSON RS vs. ALBIS LEASING AG | MOLSON RS vs. NORTHEAST UTILITIES |
| Air Liquide vs. MeVis Medical Solutions | Air Liquide vs. Compugroup Medical SE | Air Liquide vs. Japan Medical Dynamic | Air Liquide vs. Advanced Medical Solutions |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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