Correlation Between MOLSON RS and Metro AG
Can any of the company-specific risk be diversified away by investing in both MOLSON RS and Metro AG 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 Metro AG 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 Metro AG, you can compare the effects of market volatilities on MOLSON RS and Metro AG 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 Metro AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOLSON RS and Metro AG.
Diversification Opportunities for MOLSON RS and Metro AG
Pay attention - limited upside
The 3 months correlation between MOLSON and Metro is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding MOLSON RS BEVERAGE and Metro AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro AG 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 Metro AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro AG has no effect on the direction of MOLSON RS i.e., MOLSON RS and Metro AG go up and down completely randomly.
Pair Corralation between MOLSON RS and Metro AG
Assuming the 90 days trading horizon MOLSON RS BEVERAGE is expected to generate 0.89 times more return on investment than Metro AG. However, MOLSON RS BEVERAGE is 1.13 times less risky than Metro AG. It trades about 0.08 of its potential returns per unit of risk. Metro AG is currently generating about -0.15 per unit of risk. If you would invest 5,060 in MOLSON RS BEVERAGE on September 30, 2024 and sell it today you would earn a total of 390.00 from holding MOLSON RS BEVERAGE or generate 7.71% 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. Metro AG
Performance |
| Timeline |
| MOLSON RS BEVERAGE |
| Metro AG |
MOLSON RS and Metro AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MOLSON RS and Metro AG
The main advantage of trading using opposite MOLSON RS and Metro AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MOLSON RS position performs unexpectedly, Metro AG 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 Metro AG will offset losses from the drop in Metro AG's long position.| MOLSON RS vs. Fomento Econmico Mexicano | MOLSON RS vs. Anheuser Busch InBev SANV | MOLSON RS vs. Anheuser Busch InBev SANV | MOLSON RS vs. BUDWEISER BREWUNSPADR4 |
| Metro AG vs. BE Semiconductor Industries | Metro AG vs. ON SEMICONDUCTOR | Metro AG vs. Tokyu Construction Co | Metro AG vs. Daito Trust Construction |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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