Correlation Between Berkeley Energia and Molson Coors

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

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

Diversification Opportunities for Berkeley Energia and Molson Coors

-0.42

Correlation Coefficient

Berkeley Energia  Molson Coors

Very good diversification

The 3 months correlation between Berkeley and Molson is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Berkeley Energia Limited 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 Berkeley Energia 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 Berkeley Energia Limited 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 Berkeley Energia i.e., Berkeley Energia and Molson Coors go up and down completely randomly.

Pair Corralation between Berkeley Energia and Molson Coors

Assuming the 90 days horizon Berkeley Energia Limited is expected to generate 3.41 times more return on investment than Molson Coors. However, Berkeley Energia is 3.41 times more volatile than Molson Coors Brewing. It trades about 0.02 of its potential returns per unit of risk. Molson Coors Brewing is currently generating about -0.13 per unit of risk. If you would invest  31.00  in Berkeley Energia Limited on April 21, 2025 and sell it today you would lose (1.00) from holding Berkeley Energia Limited or give up 3.23% of portfolio value over 90 days.

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

Berkeley Energia Limited  vs.  Molson Coors Brewing

Berkeley Energia

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Berkeley Energia Limited are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Berkeley Energia is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Molson Coors Brewing

Risk-Adjusted Performance

Very Weak

Over the last 90 days Molson Coors Brewing has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in August 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Berkeley Energia and Molson Coors

The main advantage of trading using opposite Berkeley Energia and Molson Coors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Berkeley Energia 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 Berkeley Energia Limited 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.