Correlation Between S-E BANKEN and Coca Cola
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By analyzing existing cross correlation between S E BANKEN A and The Coca Cola, you can compare the effects of market volatilities on S-E BANKEN and Coca Cola 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 S-E BANKEN with a short position of Coca Cola. Check out your portfolio center. Please also check ongoing floating volatility patterns of S-E BANKEN and Coca Cola.
Diversification Opportunities for S-E BANKEN and Coca Cola
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between S-E and Coca is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding S E BANKEN A and The Coca Cola in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coca Cola and S-E BANKEN 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 S E BANKEN A are associated (or correlated) with Coca Cola. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coca Cola has no effect on the direction of S-E BANKEN i.e., S-E BANKEN and Coca Cola go up and down completely randomly.
Pair Corralation between S-E BANKEN and Coca Cola
Assuming the 90 days trading horizon S E BANKEN A is expected to under-perform the Coca Cola. In addition to that, S-E BANKEN is 1.97 times more volatile than The Coca Cola. It trades about -0.04 of its total potential returns per unit of risk. The Coca Cola is currently generating about 0.28 per unit of volatility. If you would invest 5,883 in The Coca Cola on November 6, 2024 and sell it today you would earn a total of 279.00 from holding The Coca Cola or generate 4.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
S E BANKEN A vs. The Coca Cola
Performance |
| Timeline |
| S E BANKEN |
| Coca Cola |
S-E BANKEN and Coca Cola Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with S-E BANKEN and Coca Cola
The main advantage of trading using opposite S-E BANKEN and Coca Cola positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if S-E BANKEN position performs unexpectedly, Coca Cola 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 Coca Cola will offset losses from the drop in Coca Cola's long position.| S-E BANKEN vs. DFS Furniture PLC | S-E BANKEN vs. The Home Depot | S-E BANKEN vs. NORTHEAST UTILITIES | S-E BANKEN vs. Cognizant Technology Solutions |
| Coca Cola vs. STMicroelectronics NV | Coca Cola vs. MARKET VECTR RETAIL | Coca Cola vs. SPARTAN STORES | Coca Cola vs. GOME Retail Holdings |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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