Correlation Between Champion Iron and Regal Funds
Can any of the company-specific risk be diversified away by investing in both Champion Iron and Regal Funds 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 Champion Iron and Regal Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Champion Iron and Regal Funds Management, you can compare the effects of market volatilities on Champion Iron and Regal Funds 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 Champion Iron with a short position of Regal Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Champion Iron and Regal Funds.
Diversification Opportunities for Champion Iron and Regal Funds
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Champion and Regal is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Champion Iron and Regal Funds Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regal Funds Management and Champion Iron 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 Champion Iron are associated (or correlated) with Regal Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regal Funds Management has no effect on the direction of Champion Iron i.e., Champion Iron and Regal Funds go up and down completely randomly.
Pair Corralation between Champion Iron and Regal Funds
Assuming the 90 days trading horizon Champion Iron is expected to under-perform the Regal Funds. In addition to that, Champion Iron is 1.13 times more volatile than Regal Funds Management. It trades about -0.04 of its total potential returns per unit of risk. Regal Funds Management is currently generating about 0.1 per unit of volatility. If you would invest 312.00 in Regal Funds Management on September 1, 2024 and sell it today you would earn a total of 91.00 from holding Regal Funds Management or generate 29.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Champion Iron vs. Regal Funds Management
Performance |
| Timeline |
| Champion Iron |
| Regal Funds Management |
Champion Iron and Regal Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Champion Iron and Regal Funds
The main advantage of trading using opposite Champion Iron and Regal Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Champion Iron position performs unexpectedly, Regal Funds 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 Regal Funds will offset losses from the drop in Regal Funds' long position.| Champion Iron vs. Dicker Data | Champion Iron vs. Data3 | Champion Iron vs. Retail Food Group | Champion Iron vs. Charter Hall Retail |
| Regal Funds vs. Ras Technology Holdings | Regal Funds vs. Macquarie Technology Group | Regal Funds vs. Bisalloy Steel Group | Regal Funds vs. Richmond Vanadium Technology |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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