Correlation Between Coca Cola and Coca Cola

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Can any of the company-specific risk be diversified away by investing in both Coca Cola 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 Coca Cola and Coca Cola into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coca Cola Europacific and Coca-Cola, you can compare the effects of market volatilities on Coca Cola 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 Coca Cola with a short position of Coca Cola. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and Coca Cola.

Diversification Opportunities for Coca Cola and Coca Cola

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Coca Cola and Coca Cola is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Coca Cola Europacific Partners and Coca-Cola in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coca-Cola and Coca Cola 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 Coca Cola Europacific 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 Coca Cola i.e., Coca Cola and Coca Cola go up and down completely randomly.

Pair Corralation between Coca Cola and Coca Cola

If you would invest  6,148  in Coca-Cola on March 26, 2022 and sell it today you would earn a total of  156.00  from holding Coca-Cola or generate 2.54% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Coca Cola Europacific Partners  vs.  Coca-Cola

 Performance (%) 
      Timeline 
Coca Cola Europacific 
Coca Cola Performance
0 of 100
Over the last 90 days Coca Cola Europacific has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical and fundamental indicators, Coca Cola is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the insiders.
Coca-Cola 
Coca Cola Performance
2 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Coca-Cola are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Coca Cola is not utilizing all of its potentials. The newest stock price mess, may contribute to short-term losses for the institutional investors.

Structure and Payout Changes

Forward Annual Dividend Yield
0.0284
Payout Ratio
0.71
Last Split Factor
2:1
Forward Annual Dividend Rate
1.76
Dividend Date
2022-07-01
Ex Dividend Date
2022-06-14
Last Split Date
2012-08-13

Coca Cola Price Channel

Coca Cola and Coca Cola Volatility Contrast

 Predicted Return Density 
      Returns 

Pair Trading with Coca Cola and Coca Cola

The main advantage of trading using opposite Coca Cola and Coca Cola positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola 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.

Coca Cola Europacific

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The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Coca Cola as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Coca Cola's systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Coca Cola's unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Coca Cola Europacific.
The idea behind Coca Cola Europacific and Coca-Cola pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Commodity Channel Index module to use Commodity Channel Index to analyze current equity momentum.

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