Correlation Between CREO MEDICAL and Yanzhou Coal
Can any of the company-specific risk be diversified away by investing in both CREO MEDICAL and Yanzhou Coal 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 CREO MEDICAL and Yanzhou Coal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CREO MEDICAL GRP and Yanzhou Coal Mining, you can compare the effects of market volatilities on CREO MEDICAL and Yanzhou Coal 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 CREO MEDICAL with a short position of Yanzhou Coal. Check out your portfolio center. Please also check ongoing floating volatility patterns of CREO MEDICAL and Yanzhou Coal.
Diversification Opportunities for CREO MEDICAL and Yanzhou Coal
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CREO and Yanzhou is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding CREO MEDICAL GRP and Yanzhou Coal Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yanzhou Coal Mining and CREO MEDICAL 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 CREO MEDICAL GRP are associated (or correlated) with Yanzhou Coal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yanzhou Coal Mining has no effect on the direction of CREO MEDICAL i.e., CREO MEDICAL and Yanzhou Coal go up and down completely randomly.
Pair Corralation between CREO MEDICAL and Yanzhou Coal
Assuming the 90 days horizon CREO MEDICAL GRP is expected to generate 3.12 times more return on investment than Yanzhou Coal. However, CREO MEDICAL is 3.12 times more volatile than Yanzhou Coal Mining. It trades about 0.34 of its potential returns per unit of risk. Yanzhou Coal Mining is currently generating about -0.25 per unit of risk. If you would invest 16.00 in CREO MEDICAL GRP on October 11, 2024 and sell it today you would earn a total of 6.00 from holding CREO MEDICAL GRP or generate 37.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 94.44% |
| Values | Daily Returns |
CREO MEDICAL GRP vs. Yanzhou Coal Mining
Performance |
| Timeline |
| CREO MEDICAL GRP |
| Yanzhou Coal Mining |
CREO MEDICAL and Yanzhou Coal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CREO MEDICAL and Yanzhou Coal
The main advantage of trading using opposite CREO MEDICAL and Yanzhou Coal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CREO MEDICAL position performs unexpectedly, Yanzhou Coal 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 Yanzhou Coal will offset losses from the drop in Yanzhou Coal's long position.| CREO MEDICAL vs. Yanzhou Coal Mining | CREO MEDICAL vs. DATA MODUL | CREO MEDICAL vs. DATAGROUP SE | CREO MEDICAL vs. Linedata Services SA |
| Yanzhou Coal vs. FIREWEED METALS P | Yanzhou Coal vs. BII Railway Transportation | Yanzhou Coal vs. Columbia Sportswear | Yanzhou Coal vs. SCIENCE IN SPORT |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |