Correlation Between Vastned Retail and Coca Cola
Can any of the company-specific risk be diversified away by investing in both Vastned Retail and Coca Cola 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 Vastned Retail and Coca Cola into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vastned Retail NV and Coca Cola Consolidated, you can compare the effects of market volatilities on Vastned Retail 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 Vastned Retail with a short position of Coca Cola. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vastned Retail and Coca Cola.
Diversification Opportunities for Vastned Retail and Coca Cola
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Vastned and Coca is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Vastned Retail NV and Coca Cola Consolidated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coca Cola Consolidated and Vastned Retail 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 Vastned Retail NV 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 Consolidated has no effect on the direction of Vastned Retail i.e., Vastned Retail and Coca Cola go up and down completely randomly.
Pair Corralation between Vastned Retail and Coca Cola
Assuming the 90 days horizon Vastned Retail NV is expected to under-perform the Coca Cola. But the stock apears to be less risky and, when comparing its historical volatility, Vastned Retail NV is 2.64 times less risky than Coca Cola. The stock trades about -0.15 of its potential returns per unit of risk. The Coca Cola Consolidated is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 116,000 in Coca Cola Consolidated on September 14, 2024 and sell it today you would earn a total of 4,000 from holding Coca Cola Consolidated or generate 3.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vastned Retail NV vs. Coca Cola Consolidated
Performance |
| Timeline |
| Vastned Retail NV |
| Coca Cola Consolidated |
Vastned Retail and Coca Cola Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vastned Retail and Coca Cola
The main advantage of trading using opposite Vastned Retail and Coca Cola positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vastned Retail 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.| Vastned Retail vs. Vicinity Centres | Vastned Retail vs. Superior Plus Corp | Vastned Retail vs. NMI Holdings | Vastned Retail vs. SIVERS SEMICONDUCTORS AB |
| Coca Cola vs. Solstad Offshore ASA | Coca Cola vs. Evolution Mining Limited | Coca Cola vs. National Beverage Corp | Coca Cola vs. THAI BEVERAGE |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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