Correlation Between Airbus Group and Coca Cola
Can any of the company-specific risk be diversified away by investing in both Airbus Group 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 Airbus Group and Coca Cola into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Airbus Group SE and Coca Cola European Partners, you can compare the effects of market volatilities on Airbus Group 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 Airbus Group with a short position of Coca Cola. Check out your portfolio center. Please also check ongoing floating volatility patterns of Airbus Group and Coca Cola.
Diversification Opportunities for Airbus Group and Coca Cola
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Airbus and Coca is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Airbus Group SE and Coca Cola European Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coca Cola European and Airbus Group 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 Airbus Group SE 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 European has no effect on the direction of Airbus Group i.e., Airbus Group and Coca Cola go up and down completely randomly.
Pair Corralation between Airbus Group and Coca Cola
Assuming the 90 days trading horizon Airbus Group SE is expected to generate 1.46 times more return on investment than Coca Cola. However, Airbus Group is 1.46 times more volatile than Coca Cola European Partners. It trades about 0.27 of its potential returns per unit of risk. Coca Cola European Partners is currently generating about 0.13 per unit of risk. If you would invest 14,100 in Airbus Group SE on April 25, 2025 and sell it today you would earn a total of 4,202 from holding Airbus Group SE or generate 29.8% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Airbus Group SE vs. Coca Cola European Partners
Performance |
Timeline |
Airbus Group SE |
Coca Cola European |
Airbus Group and Coca Cola Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Airbus Group and Coca Cola
The main advantage of trading using opposite Airbus Group and Coca Cola positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Airbus Group 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.Airbus Group vs. NH Hoteles | Airbus Group vs. Atrys Health SL | Airbus Group vs. Energy Solar Tech | Airbus Group vs. MFE Mediaforeurope NV |
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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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