Correlation Between Molson Coors and VF

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Molson Coors and VF 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 Molson Coors and VF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Molson Coors Beverage and VF Corporation, you can compare the effects of market volatilities on Molson Coors and VF 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 Molson Coors with a short position of VF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Molson Coors and VF.

Diversification Opportunities for Molson Coors and VF

0.76
  Correlation Coefficient

Poor diversification

The 3 months correlation between Molson and VF is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Molson Coors Beverage and VF Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VF Corporation and Molson Coors 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 Molson Coors Beverage are associated (or correlated) with VF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VF Corporation has no effect on the direction of Molson Coors i.e., Molson Coors and VF go up and down completely randomly.

Pair Corralation between Molson Coors and VF

Assuming the 90 days trading horizon Molson Coors is expected to generate 89.06 times less return on investment than VF. But when comparing it to its historical volatility, Molson Coors Beverage is 75.37 times less risky than VF. It trades about 0.13 of its potential returns per unit of risk. VF Corporation is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  4,722  in VF Corporation on October 25, 2024 and sell it today you would earn a total of  2,682  from holding VF Corporation or generate 56.8% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Molson Coors Beverage  vs.  VF Corp.

 Performance 
       Timeline  
Molson Coors Beverage 

Risk-Adjusted Performance

10 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Molson Coors Beverage are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong fundamental indicators, Molson Coors is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
VF Corporation 

Risk-Adjusted Performance

12 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in VF Corporation are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak fundamental indicators, VF sustained solid returns over the last few months and may actually be approaching a breakup point.

Molson Coors and VF Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Molson Coors and VF

The main advantage of trading using opposite Molson Coors and VF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Molson Coors position performs unexpectedly, VF 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 VF will offset losses from the drop in VF's long position.
The idea behind Molson Coors Beverage and VF Corporation 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 the Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.

Other Complementary Tools

Sync Your Broker
Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors.
CEOs Directory
Screen CEOs from public companies around the world
USA ETFs
Find actively traded Exchange Traded Funds (ETF) in USA
Money Managers
Screen money managers from public funds and ETFs managed around the world
Efficient Frontier
Plot and analyze your portfolio and positions against risk-return landscape of the market.