Correlation Between MOLSON RS and CARSALESCOM

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

By analyzing existing cross correlation between MOLSON RS BEVERAGE and CARSALESCOM, you can compare the effects of market volatilities on MOLSON RS and CARSALESCOM 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 MOLSON RS with a short position of CARSALESCOM. Check out your portfolio center. Please also check ongoing floating volatility patterns of MOLSON RS and CARSALESCOM.

Diversification Opportunities for MOLSON RS and CARSALESCOM

-0.25

Correlation Coefficient

MOLSON RS  CARSALESCOM

Very good diversification

The 3 months correlation between MOLSON and CARSALESCOM is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding MOLSON RS BEVERAGE and CARSALESCOM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CARSALESCOM and MOLSON RS 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 MOLSON RS BEVERAGE are associated (or correlated) with CARSALESCOM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CARSALESCOM has no effect on the direction of MOLSON RS i.e., MOLSON RS and CARSALESCOM go up and down completely randomly.

Pair Corralation between MOLSON RS and CARSALESCOM

Assuming the 90 days trading horizon MOLSON RS BEVERAGE is expected to under-perform the CARSALESCOM. In addition to that, MOLSON RS is 1.73 times more volatile than CARSALESCOM. It trades about -0.04 of its total potential returns per unit of risk. CARSALESCOM is currently generating about 0.08 per unit of volatility. If you would invest  1,950  in CARSALESCOM on May 6, 2025 and sell it today you would earn a total of  150.00  from holding CARSALESCOM or generate 7.69% return on investment over 90 days.

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

MOLSON RS BEVERAGE  vs.  CARSALESCOM

MOLSON RS BEVERAGE

Risk-Adjusted Performance

Very Weak

Over the last 90 days MOLSON RS BEVERAGE has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

CARSALESCOM

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in CARSALESCOM are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, CARSALESCOM may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with MOLSON RS and CARSALESCOM

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

The idea behind MOLSON RS BEVERAGE and CARSALESCOM 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.