Correlation Between Ramaco Resources and Figs
Can any of the company-specific risk be diversified away by investing in both Ramaco Resources and Figs 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 Ramaco Resources and Figs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ramaco Resources and Figs Inc, you can compare the effects of market volatilities on Ramaco Resources and Figs 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 Ramaco Resources with a short position of Figs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ramaco Resources and Figs.
Diversification Opportunities for Ramaco Resources and Figs
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ramaco and Figs is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Ramaco Resources and Figs Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Figs Inc and Ramaco Resources 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 Ramaco Resources are associated (or correlated) with Figs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Figs Inc has no effect on the direction of Ramaco Resources i.e., Ramaco Resources and Figs go up and down completely randomly.
Pair Corralation between Ramaco Resources and Figs
Assuming the 90 days horizon Ramaco Resources is expected to generate 0.42 times more return on investment than Figs. However, Ramaco Resources is 2.35 times less risky than Figs. It trades about 0.02 of its potential returns per unit of risk. Figs Inc is currently generating about -0.13 per unit of risk. If you would invest 1,029 in Ramaco Resources on August 28, 2024 and sell it today you would earn a total of 7.00 from holding Ramaco Resources or generate 0.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ramaco Resources vs. Figs Inc
Performance |
| Timeline |
| Ramaco Resources |
| Figs Inc |
Ramaco Resources and Figs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ramaco Resources and Figs
The main advantage of trading using opposite Ramaco Resources and Figs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ramaco Resources position performs unexpectedly, Figs 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 Figs will offset losses from the drop in Figs' long position.| Ramaco Resources vs. Molson Coors Brewing | Ramaco Resources vs. Compania Cervecerias Unidas | Ramaco Resources vs. Viemed Healthcare | Ramaco Resources vs. US Global Investors |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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