Correlation Between Nisshinbo Holdings and Yanzhou Coal
Can any of the company-specific risk be diversified away by investing in both Nisshinbo Holdings 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 Nisshinbo Holdings and Yanzhou Coal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nisshinbo Holdings and Yanzhou Coal Mining, you can compare the effects of market volatilities on Nisshinbo Holdings 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 Nisshinbo Holdings with a short position of Yanzhou Coal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nisshinbo Holdings and Yanzhou Coal.
Diversification Opportunities for Nisshinbo Holdings and Yanzhou Coal
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nisshinbo and Yanzhou is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Nisshinbo Holdings 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 Nisshinbo Holdings 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 Nisshinbo Holdings 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 Nisshinbo Holdings i.e., Nisshinbo Holdings and Yanzhou Coal go up and down completely randomly.
Pair Corralation between Nisshinbo Holdings and Yanzhou Coal
Assuming the 90 days trading horizon Nisshinbo Holdings is expected to generate 0.7 times more return on investment than Yanzhou Coal. However, Nisshinbo Holdings is 1.43 times less risky than Yanzhou Coal. It trades about 0.01 of its potential returns per unit of risk. Yanzhou Coal Mining is currently generating about -0.22 per unit of risk. If you would invest 530.00 in Nisshinbo Holdings on November 3, 2024 and sell it today you would earn a total of 0.00 from holding Nisshinbo Holdings or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nisshinbo Holdings vs. Yanzhou Coal Mining
Performance |
| Timeline |
| Nisshinbo Holdings |
| Yanzhou Coal Mining |
Nisshinbo Holdings and Yanzhou Coal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nisshinbo Holdings and Yanzhou Coal
The main advantage of trading using opposite Nisshinbo Holdings and Yanzhou Coal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nisshinbo Holdings 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.| Nisshinbo Holdings vs. Universal Health Realty | Nisshinbo Holdings vs. MEDICAL FACILITIES NEW | Nisshinbo Holdings vs. GRUPO CARSO A1 | Nisshinbo Holdings vs. SHIP HEALTHCARE HLDGINC |
| Yanzhou Coal vs. OPKO HEALTH | Yanzhou Coal vs. Commonwealth Bank of | Yanzhou Coal vs. Sims Metal Management | Yanzhou Coal vs. CeoTronics AG |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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