Correlation Between Coronado Global and London City
Can any of the company-specific risk be diversified away by investing in both Coronado Global and London City 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 Coronado Global and London City into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Coronado Global Resources and London City Equities, you can compare the effects of market volatilities on Coronado Global and London City 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 Coronado Global with a short position of London City. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coronado Global and London City.
Diversification Opportunities for Coronado Global and London City
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Coronado and London is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Coronado Global Resources and London City Equities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on London City Equities and Coronado Global 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 Coronado Global Resources are associated (or correlated) with London City. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of London City Equities has no effect on the direction of Coronado Global i.e., Coronado Global and London City go up and down completely randomly.
Pair Corralation between Coronado Global and London City
Assuming the 90 days trading horizon Coronado Global Resources is expected to under-perform the London City. In addition to that, Coronado Global is 1.84 times more volatile than London City Equities. It trades about -0.09 of its total potential returns per unit of risk. London City Equities is currently generating about 0.15 per unit of volatility. If you would invest 50.00 in London City Equities on October 18, 2024 and sell it today you would earn a total of 37.00 from holding London City Equities or generate 74.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coronado Global Resources vs. London City Equities
Performance |
| Timeline |
| Coronado Global Resources |
| London City Equities |
Coronado Global and London City Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coronado Global and London City
The main advantage of trading using opposite Coronado Global and London City positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coronado Global position performs unexpectedly, London City 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 London City will offset losses from the drop in London City's long position.| Coronado Global vs. Qbe Insurance Group | Coronado Global vs. Latitude Financial Services | Coronado Global vs. Hotel Property Investments | Coronado Global vs. Auswide Bank |
| London City vs. Energy Resources | London City vs. 88 Energy | London City vs. A1 Investments Resources | London City vs. Coronado Global Resources |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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