Correlation Between Coffee Holding and Treasury Wine
Can any of the company-specific risk be diversified away by investing in both Coffee Holding and Treasury Wine 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 Coffee Holding and Treasury Wine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coffee Holding Co and Treasury Wine Estates, you can compare the effects of market volatilities on Coffee Holding and Treasury Wine 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 Coffee Holding with a short position of Treasury Wine. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coffee Holding and Treasury Wine.
Diversification Opportunities for Coffee Holding and Treasury Wine
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Coffee and Treasury is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Coffee Holding Co and Treasury Wine Estates in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Treasury Wine Estates and Coffee Holding 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 Coffee Holding Co are associated (or correlated) with Treasury Wine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Treasury Wine Estates has no effect on the direction of Coffee Holding i.e., Coffee Holding and Treasury Wine go up and down completely randomly.
Pair Corralation between Coffee Holding and Treasury Wine
Considering the 90-day investment horizon Coffee Holding Co is expected to generate 1.15 times more return on investment than Treasury Wine. However, Coffee Holding is 1.15 times more volatile than Treasury Wine Estates. It trades about 0.02 of its potential returns per unit of risk. Treasury Wine Estates is currently generating about -0.13 per unit of risk. If you would invest 447.00 in Coffee Holding Co on July 27, 2025 and sell it today you would earn a total of 3.00 from holding Coffee Holding Co or generate 0.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coffee Holding Co vs. Treasury Wine Estates
Performance |
| Timeline |
| Coffee Holding |
| Treasury Wine Estates |
Coffee Holding and Treasury Wine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coffee Holding and Treasury Wine
The main advantage of trading using opposite Coffee Holding and Treasury Wine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coffee Holding position performs unexpectedly, Treasury Wine 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 Treasury Wine will offset losses from the drop in Treasury Wine's long position.| Coffee Holding vs. Bit Origin | Coffee Holding vs. BranchOut Food Common | Coffee Holding vs. Nocera Inc | Coffee Holding vs. Australian Oilseeds Holdings |
| Treasury Wine vs. Becle SA de | Treasury Wine vs. Endeavour Group Limited | Treasury Wine vs. Yamazaki Baking Co | Treasury Wine vs. Hengan International Group |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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