Correlation Between Saia and Molson Coors
Can any of the company-specific risk be diversified away by investing in both Saia and Molson Coors 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 Saia and Molson Coors into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saia Inc and Molson Coors Brewing, you can compare the effects of market volatilities on Saia and Molson Coors 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 Saia with a short position of Molson Coors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saia and Molson Coors.
Diversification Opportunities for Saia and Molson Coors
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Saia and Molson is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Saia Inc and Molson Coors Brewing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Molson Coors Brewing and Saia 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 Saia Inc are associated (or correlated) with Molson Coors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Molson Coors Brewing has no effect on the direction of Saia i.e., Saia and Molson Coors go up and down completely randomly.
Pair Corralation between Saia and Molson Coors
Given the investment horizon of 90 days Saia Inc is expected to generate 2.28 times more return on investment than Molson Coors. However, Saia is 2.28 times more volatile than Molson Coors Brewing. It trades about 0.22 of its potential returns per unit of risk. Molson Coors Brewing is currently generating about 0.4 per unit of risk. If you would invest 48,861 in Saia Inc on September 1, 2024 and sell it today you would earn a total of 8,047 from holding Saia Inc or generate 16.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Saia Inc vs. Molson Coors Brewing
Performance |
| Timeline |
| Saia Inc |
| Molson Coors Brewing |
Saia and Molson Coors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saia and Molson Coors
The main advantage of trading using opposite Saia and Molson Coors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saia position performs unexpectedly, Molson Coors 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 Molson Coors will offset losses from the drop in Molson Coors' long position.The idea behind Saia Inc and Molson Coors Brewing pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Molson Coors vs. Budweiser Brewing | Molson Coors vs. Boston Beer | Molson Coors vs. Anheuser Busch InBev SANV | Molson Coors vs. Ambev SA ADR |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |