Correlation Between Shift4 Payments and Coronado Global
Can any of the company-specific risk be diversified away by investing in both Shift4 Payments and Coronado Global 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 Shift4 Payments and Coronado Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shift4 Payments and Coronado Global Resources, you can compare the effects of market volatilities on Shift4 Payments and Coronado Global 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 Shift4 Payments with a short position of Coronado Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shift4 Payments and Coronado Global.
Diversification Opportunities for Shift4 Payments and Coronado Global
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shift4 and Coronado is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Shift4 Payments and Coronado Global Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coronado Global Resources and Shift4 Payments 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 Shift4 Payments are associated (or correlated) with Coronado Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coronado Global Resources has no effect on the direction of Shift4 Payments i.e., Shift4 Payments and Coronado Global go up and down completely randomly.
Pair Corralation between Shift4 Payments and Coronado Global
Given the investment horizon of 90 days Shift4 Payments is expected to generate 0.93 times more return on investment than Coronado Global. However, Shift4 Payments is 1.08 times less risky than Coronado Global. It trades about 0.14 of its potential returns per unit of risk. Coronado Global Resources is currently generating about -0.09 per unit of risk. If you would invest 9,390 in Shift4 Payments on October 25, 2024 and sell it today you would earn a total of 2,360 from holding Shift4 Payments or generate 25.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 93.75% |
| Values | Daily Returns |
Shift4 Payments vs. Coronado Global Resources
Performance |
| Timeline |
| Shift4 Payments |
| Coronado Global Resources |
Shift4 Payments and Coronado Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shift4 Payments and Coronado Global
The main advantage of trading using opposite Shift4 Payments and Coronado Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shift4 Payments position performs unexpectedly, Coronado Global 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 Coronado Global will offset losses from the drop in Coronado Global's long position.| Shift4 Payments vs. SentinelOne | Shift4 Payments vs. Confluent | Shift4 Payments vs. Hashicorp | Shift4 Payments vs. MongoDB |
| Coronado Global vs. Alpha Metallurgical Resources | Coronado Global vs. Now Inc | Coronado Global vs. Oracle | Coronado Global vs. Tegna Inc |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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