Correlation Between Alpha Services and Coca Cola

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Can any of the company-specific risk be diversified away by investing in both Alpha Services 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 Alpha Services and Coca Cola into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alpha Services and and Coca Cola HBC AG, you can compare the effects of market volatilities on Alpha Services 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 Alpha Services with a short position of Coca Cola. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alpha Services and Coca Cola.

Diversification Opportunities for Alpha Services and Coca Cola

0.31
  Correlation Coefficient

Weak diversification

The 3 months correlation between Alpha and Coca is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Alpha Services and and Coca Cola HBC AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coca Cola HBC and Alpha Services 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 Alpha Services and 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 HBC has no effect on the direction of Alpha Services i.e., Alpha Services and Coca Cola go up and down completely randomly.

Pair Corralation between Alpha Services and Coca Cola

Assuming the 90 days trading horizon Alpha Services and is expected to generate 1.92 times more return on investment than Coca Cola. However, Alpha Services is 1.92 times more volatile than Coca Cola HBC AG. It trades about 0.29 of its potential returns per unit of risk. Coca Cola HBC AG is currently generating about 0.04 per unit of risk. If you would invest  216.00  in Alpha Services and on April 25, 2025 and sell it today you would earn a total of  105.00  from holding Alpha Services and or generate 48.61% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Alpha Services and  vs.  Coca Cola HBC AG

 Performance 
       Timeline  
Alpha Services 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Alpha Services and are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Alpha Services sustained solid returns over the last few months and may actually be approaching a breakup point.
Coca Cola HBC 

Risk-Adjusted Performance

Insignificant

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Coca Cola HBC AG are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Coca Cola is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Alpha Services and Coca Cola Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Alpha Services and Coca Cola

The main advantage of trading using opposite Alpha Services and Coca Cola positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alpha Services 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.
The idea behind Alpha Services and and Coca Cola HBC AG 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.

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