Correlation Between MOLSON COORS and NEXANS
Can any of the company-specific risk be diversified away by investing in both MOLSON COORS and NEXANS 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 NEXANS 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 NEXANS, you can compare the effects of market volatilities on MOLSON COORS and NEXANS 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 NEXANS. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOLSON COORS and NEXANS.
Diversification Opportunities for MOLSON COORS and NEXANS
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MOLSON and NEXANS is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding MOLSON RS BEVERAGE and NEXANS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEXANS 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 NEXANS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEXANS has no effect on the direction of MOLSON COORS i.e., MOLSON COORS and NEXANS go up and down completely randomly.
Pair Corralation between MOLSON COORS and NEXANS
Assuming the 90 days trading horizon MOLSON RS BEVERAGE is expected to under-perform the NEXANS. In addition to that, MOLSON COORS is 1.27 times more volatile than NEXANS. It trades about -0.01 of its total potential returns per unit of risk. NEXANS is currently generating about 0.02 per unit of volatility. If you would invest 8,797 in NEXANS on October 14, 2024 and sell it today you would earn a total of 1,078 from holding NEXANS or generate 12.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MOLSON RS BEVERAGE vs. NEXANS
Performance |
| Timeline |
| MOLSON RS BEVERAGE |
| NEXANS |
MOLSON COORS and NEXANS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MOLSON COORS and NEXANS
The main advantage of trading using opposite MOLSON COORS and NEXANS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MOLSON COORS position performs unexpectedly, NEXANS 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 NEXANS will offset losses from the drop in NEXANS's long position.| MOLSON COORS vs. AM EAGLE OUTFITTERS | MOLSON COORS vs. Urban Outfitters | MOLSON COORS vs. G III Apparel Group | MOLSON COORS vs. Samsung Electronics Co |
| NEXANS vs. MOLSON RS BEVERAGE | NEXANS vs. Scottish Mortgage Investment | NEXANS vs. CN MODERN DAIRY | NEXANS vs. Astral Foods Limited |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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