Correlation Between Alpha Metallurgical and Coronado Global
Can any of the company-specific risk be diversified away by investing in both Alpha Metallurgical and Coronado Global 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 Alpha Metallurgical and Coronado Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alpha Metallurgical Resources and Coronado Global Resources, you can compare the effects of market volatilities on Alpha Metallurgical and Coronado Global 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 Alpha Metallurgical with a short position of Coronado Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alpha Metallurgical and Coronado Global.
Diversification Opportunities for Alpha Metallurgical and Coronado Global
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Alpha and Coronado is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Alpha Metallurgical Resources and Coronado Global Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coronado Global Resources and Alpha Metallurgical 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 Alpha Metallurgical Resources are associated (or correlated) with Coronado Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coronado Global Resources has no effect on the direction of Alpha Metallurgical i.e., Alpha Metallurgical and Coronado Global go up and down completely randomly.
Pair Corralation between Alpha Metallurgical and Coronado Global
Considering the 90-day investment horizon Alpha Metallurgical Resources is expected to generate 0.85 times more return on investment than Coronado Global. However, Alpha Metallurgical Resources is 1.17 times less risky than Coronado Global. It trades about -0.06 of its potential returns per unit of risk. Coronado Global Resources is currently generating about -0.07 per unit of risk. If you would invest 36,129 in Alpha Metallurgical Resources on November 3, 2024 and sell it today you would lose (17,812) from holding Alpha Metallurgical Resources or give up 49.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.41% |
| Values | Daily Returns |
Alpha Metallurgical Resources vs. Coronado Global Resources
Performance |
| Timeline |
| Alpha Metallurgical |
| Coronado Global Resources |
Alpha Metallurgical and Coronado Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alpha Metallurgical and Coronado Global
The main advantage of trading using opposite Alpha Metallurgical and Coronado Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alpha Metallurgical position performs unexpectedly, Coronado Global 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 Coronado Global will offset losses from the drop in Coronado Global's long position.| Alpha Metallurgical vs. Warrior Met Coal | Alpha Metallurgical vs. Ramaco Resources | Alpha Metallurgical vs. SunCoke Energy | Alpha Metallurgical vs. American Resources Corp |
| Coronado Global vs. Colonial Coal International | Coronado Global vs. Alpha Metallurgical Resources | Coronado Global vs. Warrior Met Coal | Coronado Global vs. Ramaco Resources |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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