Correlation Between WALMART and Coca Cola
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By analyzing existing cross correlation between WALMART INC 3625 and The Coca Cola, you can compare the effects of market volatilities on WALMART 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 WALMART with a short position of Coca Cola. Check out your portfolio center. Please also check ongoing floating volatility patterns of WALMART and Coca Cola.
Diversification Opportunities for WALMART and Coca Cola
Average diversification
The 3 months correlation between WALMART and Coca is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding WALMART INC 3625 and The Coca Cola in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coca Cola and WALMART 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 WALMART INC 3625 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 WALMART i.e., WALMART and Coca Cola go up and down completely randomly.
Pair Corralation between WALMART and Coca Cola
Assuming the 90 days trading horizon WALMART INC 3625 is expected to generate 91.74 times more return on investment than Coca Cola. However, WALMART is 91.74 times more volatile than The Coca Cola. It trades about 0.07 of its potential returns per unit of risk. The Coca Cola is currently generating about 0.02 per unit of risk. If you would invest 8,752 in WALMART INC 3625 on August 27, 2024 and sell it today you would lose (347.00) from holding WALMART INC 3625 or give up 3.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 71.37% |
| Values | Daily Returns |
WALMART INC 3625 vs. The Coca Cola
Performance |
| Timeline |
| WALMART INC 3625 |
| Coca Cola |
WALMART and Coca Cola Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with WALMART and Coca Cola
The main advantage of trading using opposite WALMART and Coca Cola positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WALMART 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.| WALMART vs. The Coca Cola | WALMART vs. JPMorgan Chase Co | WALMART vs. Dupont De Nemours | WALMART vs. Alcoa Corp |
| Coca Cola vs. Monster Beverage Corp | Coca Cola vs. Celsius Holdings | Coca Cola vs. Coca Cola Consolidated | Coca Cola vs. Keurig Dr Pepper |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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