Correlation Between Coca Cola and Attica Holdings

Can any of the company-specific risk be diversified away by investing in both Coca Cola and Attica Holdings 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 Attica Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Coca Cola HBC AG and Attica Holdings SA, you can compare the effects of market volatilities on Coca Cola and Attica Holdings 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 Attica Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and Attica Holdings.

Diversification Opportunities for Coca Cola and Attica Holdings

0.26

Correlation Coefficient

Coca Cola  Attica Holdings

Modest diversification

The 3 months correlation between Coca and Attica is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Coca Cola HBC AG and Attica Holdings SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Attica Holdings SA 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 HBC AG are associated (or correlated) with Attica Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Attica Holdings SA has no effect on the direction of Coca Cola i.e., Coca Cola and Attica Holdings go up and down completely randomly.

Pair Corralation between Coca Cola and Attica Holdings

Assuming the 90 days trading horizon Coca Cola HBC AG is expected to generate 0.84 times more return on investment than Attica Holdings. However, Coca Cola HBC AG is 1.19 times less risky than Attica Holdings. It trades about 0.27 of its potential returns per unit of risk. Attica Holdings SA is currently generating about 0.06 per unit of risk. If you would invest  3,288  in Coca Cola HBC AG on December 30, 2024 and sell it today you would earn a total of  918.00  from holding Coca Cola HBC AG or generate 27.92% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Coca Cola HBC AG  vs.  Attica Holdings SA

Coca Cola HBC

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Coca Cola HBC AG are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain technical and fundamental indicators, Coca Cola unveiled solid returns over the last few months and may actually be approaching a breakup point.

Attica Holdings SA

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Attica Holdings SA are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain basic indicators, Attica Holdings may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Coca Cola and Attica Holdings

The main advantage of trading using opposite Coca Cola and Attica Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, Attica Holdings 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 Attica Holdings will offset losses from the drop in Attica Holdings' long position.

The idea behind Coca Cola HBC AG and Attica Holdings SA 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.

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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.