Correlation Between Monster Beverage and COCA A

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

Diversification Opportunities for Monster Beverage and COCA A

MonsterCOCADiversified AwayMonsterCOCADiversified Away100%
-0.28
  Correlation Coefficient

Very good diversification

The 3 months correlation between Monster and COCA is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Monster Beverage Corp and COCA A HBC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COCA A HBC and Monster Beverage 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 Monster Beverage Corp are associated (or correlated) with COCA A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COCA A HBC has no effect on the direction of Monster Beverage i.e., Monster Beverage and COCA A go up and down completely randomly.

Pair Corralation between Monster Beverage and COCA A

Assuming the 90 days horizon Monster Beverage Corp is expected to under-perform the COCA A. But the stock apears to be less risky and, when comparing its historical volatility, Monster Beverage Corp is 1.17 times less risky than COCA A. The stock trades about -0.05 of its potential returns per unit of risk. The COCA A HBC is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  3,260  in COCA A HBC on November 19, 2024 and sell it today you would earn a total of  540.00  from holding COCA A HBC or generate 16.56% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Monster Beverage Corp  vs.  COCA A HBC

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -50510
JavaScript chart by amCharts 3.21.15MOB CCKC
       Timeline  
Monster Beverage Corp 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Monster Beverage Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Monster Beverage is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb454647484950515253
COCA A HBC 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in COCA A HBC are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile forward-looking signals, COCA A reported solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb32333435363738

Monster Beverage and COCA A Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-6.07-4.58-3.09-1.59-0.11.392.884.385.877.36 0.020.040.060.080.100.120.14
JavaScript chart by amCharts 3.21.15MOB CCKC
       Returns  

Pair Trading with Monster Beverage and COCA A

The main advantage of trading using opposite Monster Beverage and COCA A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Monster Beverage position performs unexpectedly, COCA A 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 A will offset losses from the drop in COCA A's long position.
The idea behind Monster Beverage Corp and COCA A HBC 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.

Other Complementary Tools

Fundamentals Comparison
Compare fundamentals across multiple equities to find investing opportunities
Crypto Correlations
Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins
Efficient Frontier
Plot and analyze your portfolio and positions against risk-return landscape of the market.
Analyst Advice
Analyst recommendations and target price estimates broken down by several categories
Money Managers
Screen money managers from public funds and ETFs managed around the world