Correlation Between COAST ENTERTAINMENT and Jade Gas
Can any of the company-specific risk be diversified away by investing in both COAST ENTERTAINMENT and Jade Gas 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 Jade Gas 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 Jade Gas Holdings, you can compare the effects of market volatilities on COAST ENTERTAINMENT and Jade Gas 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 Jade Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of COAST ENTERTAINMENT and Jade Gas.
Diversification Opportunities for COAST ENTERTAINMENT and Jade Gas
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between COAST and Jade is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding COAST ENTERTAINMENT HOLDINGS and Jade Gas Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jade Gas Holdings 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 Jade Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jade Gas Holdings has no effect on the direction of COAST ENTERTAINMENT i.e., COAST ENTERTAINMENT and Jade Gas go up and down completely randomly.
Pair Corralation between COAST ENTERTAINMENT and Jade Gas
Assuming the 90 days trading horizon COAST ENTERTAINMENT is expected to generate 2.48 times less return on investment than Jade Gas. But when comparing it to its historical volatility, COAST ENTERTAINMENT HOLDINGS is 2.23 times less risky than Jade Gas. It trades about 0.01 of its potential returns per unit of risk. Jade Gas Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 4.50 in Jade Gas Holdings on September 12, 2024 and sell it today you would lose (1.10) from holding Jade Gas Holdings or give up 24.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
COAST ENTERTAINMENT HOLDINGS vs. Jade Gas Holdings
Performance |
| Timeline |
| COAST ENTERTAINMENT |
| Jade Gas Holdings |
COAST ENTERTAINMENT and Jade Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COAST ENTERTAINMENT and Jade Gas
The main advantage of trading using opposite COAST ENTERTAINMENT and Jade Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COAST ENTERTAINMENT position performs unexpectedly, Jade Gas 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 Jade Gas will offset losses from the drop in Jade Gas' long position.| COAST ENTERTAINMENT vs. WiseTech Global Limited | COAST ENTERTAINMENT vs. My Foodie Box | COAST ENTERTAINMENT vs. Ras Technology Holdings | COAST ENTERTAINMENT vs. Retail Food Group |
| Jade Gas vs. Argo Investments | Jade Gas vs. Dug Technology | Jade Gas vs. Ainsworth Game Technology | Jade Gas vs. REGAL ASIAN INVESTMENTS |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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