Correlation Between Consol Energy and Jeld Wen
Can any of the company-specific risk be diversified away by investing in both Consol Energy and Jeld Wen 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 Jeld Wen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Consol Energy and Jeld Wen Holding, you can compare the effects of market volatilities on Consol Energy and Jeld Wen 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 Jeld Wen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Consol Energy and Jeld Wen.
Diversification Opportunities for Consol Energy and Jeld Wen
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Consol and Jeld is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Consol Energy and Jeld Wen Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jeld Wen Holding 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 Jeld Wen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jeld Wen Holding has no effect on the direction of Consol Energy i.e., Consol Energy and Jeld Wen go up and down completely randomly.
Pair Corralation between Consol Energy and Jeld Wen
Given the investment horizon of 90 days Consol Energy is expected to generate 0.63 times more return on investment than Jeld Wen. However, Consol Energy is 1.59 times less risky than Jeld Wen. It trades about 0.1 of its potential returns per unit of risk. Jeld Wen Holding is currently generating about -0.04 per unit of risk. If you would invest 9,846 in Consol Energy on September 2, 2024 and sell it today you would earn a total of 3,224 from holding Consol Energy or generate 32.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Consol Energy vs. Jeld Wen Holding
Performance |
| Timeline |
| Consol Energy |
| Jeld Wen Holding |
Consol Energy and Jeld Wen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Consol Energy and Jeld Wen
The main advantage of trading using opposite Consol Energy and Jeld Wen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Consol Energy position performs unexpectedly, Jeld Wen 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 Jeld Wen will offset losses from the drop in Jeld Wen'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 |
| Jeld Wen vs. Gibraltar Industries | Jeld Wen vs. Quanex Building Products | Jeld Wen vs. Perma Pipe International Holdings | Jeld Wen vs. Interface |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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