Correlation Between GENERAL and Coca Cola
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By analyzing existing cross correlation between GENERAL DYNAMICS P and The Coca Cola, you can compare the effects of market volatilities on GENERAL 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 GENERAL with a short position of Coca Cola. Check out your portfolio center. Please also check ongoing floating volatility patterns of GENERAL and Coca Cola.
Diversification Opportunities for GENERAL and Coca Cola
Poor diversification
The 3 months correlation between GENERAL and Coca is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding GENERAL DYNAMICS P and The Coca Cola in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coca Cola and GENERAL 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 GENERAL DYNAMICS P 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 GENERAL i.e., GENERAL and Coca Cola go up and down completely randomly.
Pair Corralation between GENERAL and Coca Cola
Assuming the 90 days trading horizon GENERAL DYNAMICS P is expected to generate 0.31 times more return on investment than Coca Cola. However, GENERAL DYNAMICS P is 3.18 times less risky than Coca Cola. It trades about -0.14 of its potential returns per unit of risk. The Coca Cola is currently generating about -0.06 per unit of risk. If you would invest 9,757 in GENERAL DYNAMICS P on September 1, 2024 and sell it today you would lose (75.00) from holding GENERAL DYNAMICS P or give up 0.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GENERAL DYNAMICS P vs. The Coca Cola
Performance |
| Timeline |
| GENERAL DYNAMICS P |
| Coca Cola |
GENERAL and Coca Cola Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GENERAL and Coca Cola
The main advantage of trading using opposite GENERAL and Coca Cola positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GENERAL 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.| GENERAL vs. Acco Brands | GENERAL vs. 51Talk Online Education | GENERAL vs. 17 Education Technology | GENERAL vs. AMREP |
| Coca Cola vs. Coca Cola Femsa SAB | Coca Cola vs. Embotelladora Andina SA | Coca Cola vs. National Beverage Corp | Coca Cola vs. Embotelladora Andina SA |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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