Correlation Between Integral and Consol Energy
Can any of the company-specific risk be diversified away by investing in both Integral and Consol Energy 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 Integral and Consol Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Integral Ad Science and Consol Energy, you can compare the effects of market volatilities on Integral and Consol Energy 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 Integral with a short position of Consol Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Integral and Consol Energy.
Diversification Opportunities for Integral and Consol Energy
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Integral and Consol is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Integral Ad Science and Consol Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Consol Energy and Integral 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 Integral Ad Science are associated (or correlated) with Consol Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Consol Energy has no effect on the direction of Integral i.e., Integral and Consol Energy go up and down completely randomly.
Pair Corralation between Integral and Consol Energy
Considering the 90-day investment horizon Integral Ad Science is expected to under-perform the Consol Energy. In addition to that, Integral is 1.23 times more volatile than Consol Energy. It trades about -0.05 of its total potential returns per unit of risk. Consol Energy is currently generating about 0.27 per unit of volatility. If you would invest 11,070 in Consol Energy on September 1, 2024 and sell it today you would earn a total of 2,000 from holding Consol Energy or generate 18.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Integral Ad Science vs. Consol Energy
Performance |
| Timeline |
| Integral Ad Science |
| Consol Energy |
Integral and Consol Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Integral and Consol Energy
The main advantage of trading using opposite Integral and Consol Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Integral position performs unexpectedly, Consol Energy 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 Consol Energy will offset losses from the drop in Consol Energy's long position.The idea behind Integral Ad Science and Consol Energy pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Consol Energy vs. Alliance Resource Partners | Consol Energy vs. Natural Resource Partners | Consol Energy vs. Hallador Energy | Consol Energy vs. NACCO Industries |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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