Correlation Between SHIP HEALTHCARE and CONSOL Energy
Can any of the company-specific risk be diversified away by investing in both SHIP HEALTHCARE and CONSOL Energy 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 SHIP HEALTHCARE and CONSOL Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SHIP HEALTHCARE HLDGINC and CONSOL Energy, you can compare the effects of market volatilities on SHIP HEALTHCARE and CONSOL Energy 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 SHIP HEALTHCARE with a short position of CONSOL Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of SHIP HEALTHCARE and CONSOL Energy.
Diversification Opportunities for SHIP HEALTHCARE and CONSOL Energy
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SHIP and CONSOL is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding SHIP HEALTHCARE HLDGINC and CONSOL Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CONSOL Energy and SHIP HEALTHCARE 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 SHIP HEALTHCARE HLDGINC are associated (or correlated) with CONSOL Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CONSOL Energy has no effect on the direction of SHIP HEALTHCARE i.e., SHIP HEALTHCARE and CONSOL Energy go up and down completely randomly.
Pair Corralation between SHIP HEALTHCARE and CONSOL Energy
Assuming the 90 days horizon SHIP HEALTHCARE is expected to generate 1.33 times less return on investment than CONSOL Energy. In addition to that, SHIP HEALTHCARE is 1.26 times more volatile than CONSOL Energy. It trades about 0.05 of its total potential returns per unit of risk. CONSOL Energy is currently generating about 0.08 per unit of volatility. If you would invest 5,951 in CONSOL Energy on September 12, 2024 and sell it today you would earn a total of 5,079 from holding CONSOL Energy or generate 85.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SHIP HEALTHCARE HLDGINC vs. CONSOL Energy
Performance |
| Timeline |
| SHIP HEALTHCARE HLDGINC |
| CONSOL Energy |
SHIP HEALTHCARE and CONSOL Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SHIP HEALTHCARE and CONSOL Energy
The main advantage of trading using opposite SHIP HEALTHCARE and CONSOL Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SHIP HEALTHCARE position performs unexpectedly, CONSOL Energy 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 CONSOL Energy will offset losses from the drop in CONSOL Energy's long position.| SHIP HEALTHCARE vs. Superior Plus Corp | SHIP HEALTHCARE vs. NMI Holdings | SHIP HEALTHCARE vs. SIVERS SEMICONDUCTORS AB | SHIP HEALTHCARE vs. NorAm Drilling AS |
| CONSOL Energy vs. Dave Busters Entertainment | CONSOL Energy vs. Platinum Investment Management | CONSOL Energy vs. PT Global Mediacom | CONSOL Energy vs. Tencent Music Entertainment |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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