Correlation Between COAST ENTERTAINMENT and Austco Healthcare
Can any of the company-specific risk be diversified away by investing in both COAST ENTERTAINMENT and Austco Healthcare 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 COAST ENTERTAINMENT and Austco Healthcare into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between COAST ENTERTAINMENT HOLDINGS and Austco Healthcare, you can compare the effects of market volatilities on COAST ENTERTAINMENT and Austco Healthcare 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 COAST ENTERTAINMENT with a short position of Austco Healthcare. Check out your portfolio center. Please also check ongoing floating volatility patterns of COAST ENTERTAINMENT and Austco Healthcare.
Diversification Opportunities for COAST ENTERTAINMENT and Austco Healthcare
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between COAST and Austco is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding COAST ENTERTAINMENT HOLDINGS and Austco Healthcare in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Austco Healthcare and COAST ENTERTAINMENT 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 COAST ENTERTAINMENT HOLDINGS are associated (or correlated) with Austco Healthcare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Austco Healthcare has no effect on the direction of COAST ENTERTAINMENT i.e., COAST ENTERTAINMENT and Austco Healthcare go up and down completely randomly.
Pair Corralation between COAST ENTERTAINMENT and Austco Healthcare
Assuming the 90 days trading horizon COAST ENTERTAINMENT HOLDINGS is expected to under-perform the Austco Healthcare. But the stock apears to be less risky and, when comparing its historical volatility, COAST ENTERTAINMENT HOLDINGS is 1.06 times less risky than Austco Healthcare. The stock trades about -0.1 of its potential returns per unit of risk. The Austco Healthcare is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest 26.00 in Austco Healthcare on September 1, 2024 and sell it today you would lose (1.00) from holding Austco Healthcare or give up 3.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
COAST ENTERTAINMENT HOLDINGS vs. Austco Healthcare
Performance |
| Timeline |
| COAST ENTERTAINMENT |
| Austco Healthcare |
COAST ENTERTAINMENT and Austco Healthcare Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COAST ENTERTAINMENT and Austco Healthcare
The main advantage of trading using opposite COAST ENTERTAINMENT and Austco Healthcare positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COAST ENTERTAINMENT position performs unexpectedly, Austco Healthcare 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 Austco Healthcare will offset losses from the drop in Austco Healthcare's long position.| COAST ENTERTAINMENT vs. Pinnacle Investment Management | COAST ENTERTAINMENT vs. Retail Food Group | COAST ENTERTAINMENT vs. Charter Hall Retail | COAST ENTERTAINMENT vs. Aussie Broadband |
| Austco Healthcare vs. Jupiter Energy | Austco Healthcare vs. WA1 Resources | Austco Healthcare vs. Cooper Metals | Austco Healthcare vs. OD6 Metals |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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