Correlation Between Coca Cola and Acciona

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

By analyzing existing cross correlation between Coca Cola European Partners and Acciona, you can compare the effects of market volatilities on Coca Cola and Acciona 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 Coca Cola with a short position of Acciona. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coca Cola and Acciona.

Diversification Opportunities for Coca Cola and Acciona

0.82

Correlation Coefficient

Coca Cola  Acciona

Very poor diversification

The 3 months correlation between Coca and Acciona is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Coca Cola European Partners and Acciona in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Acciona and Coca Cola 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 Coca Cola European Partners are associated (or correlated) with Acciona. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Acciona has no effect on the direction of Coca Cola i.e., Coca Cola and Acciona go up and down completely randomly.

Pair Corralation between Coca Cola and Acciona

Assuming the 90 days trading horizon Coca Cola is expected to generate 3.92 times less return on investment than Acciona. But when comparing it to its historical volatility, Coca Cola European Partners is 1.4 times less risky than Acciona. It trades about 0.13 of its potential returns per unit of risk. Acciona is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest  11,921  in Acciona on April 24, 2025 and sell it today you would earn a total of  4,609  from holding Acciona or generate 38.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Coca Cola European Partners  vs.  Acciona

Coca Cola European

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Coca Cola European Partners are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady fundamental indicators, Coca Cola may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Acciona

Risk-Adjusted Performance

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Acciona are ranked lower than 27 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Acciona exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Coca Cola and Acciona

The main advantage of trading using opposite Coca Cola and Acciona positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coca Cola position performs unexpectedly, Acciona 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 Acciona will offset losses from the drop in Acciona's long position.

The idea behind Coca Cola European Partners and Acciona 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 Global Correlations module to find global opportunities by holding instruments from different markets.