Correlation Between SLR Investment and Molson Coors
Can any of the company-specific risk be diversified away by investing in both SLR Investment and Molson Coors 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 SLR Investment and Molson Coors into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SLR Investment Corp and Molson Coors Beverage, you can compare the effects of market volatilities on SLR Investment and Molson Coors 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 SLR Investment with a short position of Molson Coors. Check out your portfolio center. Please also check ongoing floating volatility patterns of SLR Investment and Molson Coors.
Diversification Opportunities for SLR Investment and Molson Coors
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between SLR and Molson is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding SLR Investment Corp and Molson Coors Beverage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Molson Coors Beverage and SLR Investment 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 SLR Investment Corp are associated (or correlated) with Molson Coors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Molson Coors Beverage has no effect on the direction of SLR Investment i.e., SLR Investment and Molson Coors go up and down completely randomly.
Pair Corralation between SLR Investment and Molson Coors
Assuming the 90 days horizon SLR Investment Corp is expected to generate 1.02 times more return on investment than Molson Coors. However, SLR Investment is 1.02 times more volatile than Molson Coors Beverage. It trades about 0.19 of its potential returns per unit of risk. Molson Coors Beverage is currently generating about 0.06 per unit of risk. If you would invest 1,501 in SLR Investment Corp on September 13, 2024 and sell it today you would earn a total of 85.00 from holding SLR Investment Corp or generate 5.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SLR Investment Corp vs. Molson Coors Beverage
Performance |
| Timeline |
| SLR Investment Corp |
| Molson Coors Beverage |
SLR Investment and Molson Coors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SLR Investment and Molson Coors
The main advantage of trading using opposite SLR Investment and Molson Coors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SLR Investment position performs unexpectedly, Molson Coors 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 Molson Coors will offset losses from the drop in Molson Coors' long position.| SLR Investment vs. EVS Broadcast Equipment | SLR Investment vs. Summit Hotel Properties | SLR Investment vs. Park Hotels Resorts | SLR Investment vs. BROADSTNET LEADL 00025 |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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