Correlation Between Molson Coors and BGC
Can any of the company-specific risk be diversified away by investing in both Molson Coors and BGC 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 BGC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Molson Coors Brewing and BGC Group, you can compare the effects of market volatilities on Molson Coors and BGC 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 BGC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Molson Coors and BGC.
Diversification Opportunities for Molson Coors and BGC
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Molson and BGC is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Molson Coors Brewing and BGC Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BGC Group 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 Coors Brewing are associated (or correlated) with BGC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BGC Group has no effect on the direction of Molson Coors i.e., Molson Coors and BGC go up and down completely randomly.
Pair Corralation between Molson Coors and BGC
Considering the 90-day investment horizon Molson Coors Brewing is expected to generate 0.53 times more return on investment than BGC. However, Molson Coors Brewing is 1.88 times less risky than BGC. It trades about 0.29 of its potential returns per unit of risk. BGC Group is currently generating about 0.06 per unit of risk. If you would invest 5,548 in Molson Coors Brewing on August 31, 2024 and sell it today you would earn a total of 577.00 from holding Molson Coors Brewing or generate 10.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Molson Coors Brewing vs. BGC Group
Performance |
| Timeline |
| Molson Coors Brewing |
| BGC Group |
Molson Coors and BGC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Molson Coors and BGC
The main advantage of trading using opposite Molson Coors and BGC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Molson Coors position performs unexpectedly, BGC 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 BGC will offset losses from the drop in BGC's long position.| 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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