Correlation Between HMS Bergbau and Ichor Coal
Can any of the company-specific risk be diversified away by investing in both HMS Bergbau and Ichor 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 HMS Bergbau and Ichor Coal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HMS Bergbau AG and Ichor Coal NV, you can compare the effects of market volatilities on HMS Bergbau and Ichor 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 HMS Bergbau with a short position of Ichor Coal. Check out your portfolio center. Please also check ongoing floating volatility patterns of HMS Bergbau and Ichor Coal.
Diversification Opportunities for HMS Bergbau and Ichor Coal
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HMS and Ichor is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding HMS Bergbau AG and Ichor Coal NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ichor Coal NV and HMS Bergbau 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 HMS Bergbau AG are associated (or correlated) with Ichor Coal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ichor Coal NV has no effect on the direction of HMS Bergbau i.e., HMS Bergbau and Ichor Coal go up and down completely randomly.
Pair Corralation between HMS Bergbau and Ichor Coal
Assuming the 90 days trading horizon HMS Bergbau AG is expected to generate 0.35 times more return on investment than Ichor Coal. However, HMS Bergbau AG is 2.87 times less risky than Ichor Coal. It trades about 0.1 of its potential returns per unit of risk. Ichor Coal NV is currently generating about -0.1 per unit of risk. If you would invest 1,972 in HMS Bergbau AG on September 2, 2024 and sell it today you would earn a total of 928.00 from holding HMS Bergbau AG or generate 47.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.41% |
| Values | Daily Returns |
HMS Bergbau AG vs. Ichor Coal NV
Performance |
| Timeline |
| HMS Bergbau AG |
| Ichor Coal NV |
HMS Bergbau and Ichor Coal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HMS Bergbau and Ichor Coal
The main advantage of trading using opposite HMS Bergbau and Ichor Coal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HMS Bergbau position performs unexpectedly, Ichor 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 Ichor Coal will offset losses from the drop in Ichor Coal's long position.| HMS Bergbau vs. YATRA ONLINE DL 0001 | HMS Bergbau vs. Entravision Communications | HMS Bergbau vs. Iridium Communications | HMS Bergbau vs. SK TELECOM TDADR |
| Ichor Coal vs. Astral Foods Limited | Ichor Coal vs. Tyson Foods | Ichor Coal vs. CeoTronics AG | Ichor Coal vs. WT OFFSHORE |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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