Correlation Between DICKER DATA and Yanzhou Coal
Can any of the company-specific risk be diversified away by investing in both DICKER DATA and Yanzhou Coal 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 DICKER DATA and Yanzhou Coal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between DICKER DATA LTD and Yanzhou Coal Mining, you can compare the effects of market volatilities on DICKER DATA and Yanzhou Coal 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 DICKER DATA with a short position of Yanzhou Coal. Check out your portfolio center. Please also check ongoing floating volatility patterns of DICKER DATA and Yanzhou Coal.
Diversification Opportunities for DICKER DATA and Yanzhou Coal
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between DICKER and Yanzhou is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding DICKER DATA LTD and Yanzhou Coal Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yanzhou Coal Mining and DICKER DATA 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 DICKER DATA LTD are associated (or correlated) with Yanzhou Coal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yanzhou Coal Mining has no effect on the direction of DICKER DATA i.e., DICKER DATA and Yanzhou Coal go up and down completely randomly.
Pair Corralation between DICKER DATA and Yanzhou Coal
Assuming the 90 days horizon DICKER DATA LTD is expected to under-perform the Yanzhou Coal. But the stock apears to be less risky and, when comparing its historical volatility, DICKER DATA LTD is 1.38 times less risky than Yanzhou Coal. The stock trades about -0.03 of its potential returns per unit of risk. The Yanzhou Coal Mining is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 101.00 in Yanzhou Coal Mining on September 12, 2024 and sell it today you would earn a total of 11.00 from holding Yanzhou Coal Mining or generate 10.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
DICKER DATA LTD vs. Yanzhou Coal Mining
Performance |
| Timeline |
| DICKER DATA LTD |
| Yanzhou Coal Mining |
DICKER DATA and Yanzhou Coal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with DICKER DATA and Yanzhou Coal
The main advantage of trading using opposite DICKER DATA and Yanzhou Coal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if DICKER DATA position performs unexpectedly, Yanzhou Coal 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 Yanzhou Coal will offset losses from the drop in Yanzhou Coal's long position.| DICKER DATA vs. HK Electric Investments | DICKER DATA vs. Perma Fix Environmental Services | DICKER DATA vs. Virtus Investment Partners | DICKER DATA vs. COSMOSTEEL HLDGS |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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