Correlation Between Ihuman and Molson Coors

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

By analyzing existing cross correlation between Ihuman Inc and Molson Coors Brewing, you can compare the effects of market volatilities on Ihuman 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 Ihuman with a short position of Molson Coors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ihuman and Molson Coors.

Diversification Opportunities for Ihuman and Molson Coors

-0.66

Correlation Coefficient

Ihuman  Molson Coors

Excellent diversification

The 3 months correlation between Ihuman and Molson is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Ihuman Inc and Molson Coors Brewing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Molson Coors Brewing and Ihuman 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 Ihuman Inc 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 Brewing has no effect on the direction of Ihuman i.e., Ihuman and Molson Coors go up and down completely randomly.

Pair Corralation between Ihuman and Molson Coors

Allowing for the 90-day total investment horizon Ihuman Inc is expected to generate 1.99 times more return on investment than Molson Coors. However, Ihuman is 1.99 times more volatile than Molson Coors Brewing. It trades about -0.18 of its potential returns per unit of risk. Molson Coors Brewing is currently generating about -0.42 per unit of risk. If you would invest  172.00  in Ihuman Inc on October 9, 2024 and sell it today you would lose (14.00) from holding Ihuman Inc or give up 8.14% of portfolio value over 90 days.

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

Ihuman Inc  vs.  Molson Coors Brewing

Ihuman Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ihuman Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical indicators remain fairly strong which may send shares a bit higher in February 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Molson Coors Brewing

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Molson Coors Brewing are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Molson Coors is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Ihuman and Molson Coors

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

The idea behind Ihuman Inc and Molson Coors Brewing 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.