Correlation Between INTER CARS and Ichor Coal
Can any of the company-specific risk be diversified away by investing in both INTER CARS and Ichor 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 INTER CARS and Ichor Coal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between INTER CARS SA and Ichor Coal NV, you can compare the effects of market volatilities on INTER CARS and Ichor 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 INTER CARS with a short position of Ichor Coal. Check out your portfolio center. Please also check ongoing floating volatility patterns of INTER CARS and Ichor Coal.
Diversification Opportunities for INTER CARS and Ichor Coal
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between INTER and Ichor is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding INTER CARS SA and Ichor Coal NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ichor Coal NV and INTER CARS 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 INTER CARS SA are associated (or correlated) with Ichor Coal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ichor Coal NV has no effect on the direction of INTER CARS i.e., INTER CARS and Ichor Coal go up and down completely randomly.
Pair Corralation between INTER CARS and Ichor Coal
Assuming the 90 days horizon INTER CARS SA is expected to generate 0.84 times more return on investment than Ichor Coal. However, INTER CARS SA is 1.2 times less risky than Ichor Coal. It trades about 0.0 of its potential returns per unit of risk. Ichor Coal NV is currently generating about -0.14 per unit of risk. If you would invest 13,223 in INTER CARS SA on September 12, 2024 and sell it today you would lose (1,463) from holding INTER CARS SA or give up 11.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.16% |
| Values | Daily Returns |
INTER CARS SA vs. Ichor Coal NV
Performance |
| Timeline |
| INTER CARS SA |
| Ichor Coal NV |
INTER CARS and Ichor Coal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with INTER CARS and Ichor Coal
The main advantage of trading using opposite INTER CARS and Ichor Coal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if INTER CARS position performs unexpectedly, Ichor 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 Ichor Coal will offset losses from the drop in Ichor Coal's long position.| INTER CARS vs. Bridgestone | INTER CARS vs. Superior Plus Corp | INTER CARS vs. SIVERS SEMICONDUCTORS AB | INTER CARS vs. Norsk Hydro ASA |
| Ichor Coal vs. CHINA SHENHUA ENA | Ichor Coal vs. China Coal Energy | Ichor Coal vs. Yancoal Australia | Ichor Coal vs. Banpu PCL |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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