Correlation Between Coronado Global and Ramsay Health
Can any of the company-specific risk be diversified away by investing in both Coronado Global and Ramsay Health 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 Ramsay Health 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 Ramsay Health Care, you can compare the effects of market volatilities on Coronado Global and Ramsay Health 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 Ramsay Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Coronado Global and Ramsay Health.
Diversification Opportunities for Coronado Global and Ramsay Health
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Coronado and Ramsay is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Coronado Global Resources and Ramsay Health Care in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ramsay Health Care 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 Ramsay Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ramsay Health Care has no effect on the direction of Coronado Global i.e., Coronado Global and Ramsay Health go up and down completely randomly.
Pair Corralation between Coronado Global and Ramsay Health
Assuming the 90 days trading horizon Coronado Global Resources is expected to under-perform the Ramsay Health. In addition to that, Coronado Global is 1.44 times more volatile than Ramsay Health Care. It trades about -0.21 of its total potential returns per unit of risk. Ramsay Health Care is currently generating about 0.04 per unit of volatility. If you would invest 3,391 in Ramsay Health Care on December 1, 2024 and sell it today you would earn a total of 49.00 from holding Ramsay Health Care or generate 1.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Coronado Global Resources vs. Ramsay Health Care
Performance |
| Timeline |
| Coronado Global Resources |
| Ramsay Health Care |
Coronado Global and Ramsay Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Coronado Global and Ramsay Health
The main advantage of trading using opposite Coronado Global and Ramsay Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Coronado Global position performs unexpectedly, Ramsay Health 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 Ramsay Health will offset losses from the drop in Ramsay Health's long position.| Coronado Global vs. Sports Entertainment Group | Coronado Global vs. Oneview Healthcare PLC | Coronado Global vs. Autosports Group | Coronado Global vs. Home Consortium |
| Ramsay Health vs. Black Rock Mining | Ramsay Health vs. Southern Cross Media | Ramsay Health vs. Computershare | Ramsay Health vs. Seven West Media |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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