Correlation Between Consol Energy and Four Leaf
Can any of the company-specific risk be diversified away by investing in both Consol Energy and Four Leaf 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 Consol Energy and Four Leaf into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Consol Energy and Four Leaf Acquisition, you can compare the effects of market volatilities on Consol Energy and Four Leaf 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 Consol Energy with a short position of Four Leaf. Check out your portfolio center. Please also check ongoing floating volatility patterns of Consol Energy and Four Leaf.
Diversification Opportunities for Consol Energy and Four Leaf
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Consol and Four is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Consol Energy and Four Leaf Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Four Leaf Acquisition and Consol Energy 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 Consol Energy are associated (or correlated) with Four Leaf. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Four Leaf Acquisition has no effect on the direction of Consol Energy i.e., Consol Energy and Four Leaf go up and down completely randomly.
Pair Corralation between Consol Energy and Four Leaf
Given the investment horizon of 90 days Consol Energy is expected to generate 46.42 times less return on investment than Four Leaf. But when comparing it to its historical volatility, Consol Energy is 27.56 times less risky than Four Leaf. It trades about 0.06 of its potential returns per unit of risk. Four Leaf Acquisition is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 0.00 in Four Leaf Acquisition on September 3, 2024 and sell it today you would earn a total of 5.50 from holding Four Leaf Acquisition or generate 9.223372036854776E16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 37.98% |
| Values | Daily Returns |
Consol Energy vs. Four Leaf Acquisition
Performance |
| Timeline |
| Consol Energy |
| Four Leaf Acquisition |
Consol Energy and Four Leaf Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Consol Energy and Four Leaf
The main advantage of trading using opposite Consol Energy and Four Leaf positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Consol Energy position performs unexpectedly, Four Leaf 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 Four Leaf will offset losses from the drop in Four Leaf's long position.| Consol Energy vs. Alliance Resource Partners | Consol Energy vs. Natural Resource Partners | Consol Energy vs. Hallador Energy | Consol Energy vs. NACCO Industries |
| Four Leaf vs. Alpha One | Four Leaf vs. Manaris Corp | Four Leaf vs. SCOR PK | Four Leaf vs. Aquagold International |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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