Correlation Between Red Hill and REGAL ASIAN
Can any of the company-specific risk be diversified away by investing in both Red Hill and REGAL ASIAN 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 Red Hill and REGAL ASIAN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Red Hill Iron and REGAL ASIAN INVESTMENTS, you can compare the effects of market volatilities on Red Hill and REGAL ASIAN 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 Red Hill with a short position of REGAL ASIAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Red Hill and REGAL ASIAN.
Diversification Opportunities for Red Hill and REGAL ASIAN
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Red and REGAL is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Red Hill Iron and REGAL ASIAN INVESTMENTS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on REGAL ASIAN INVESTMENTS and Red Hill 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 Red Hill Iron are associated (or correlated) with REGAL ASIAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of REGAL ASIAN INVESTMENTS has no effect on the direction of Red Hill i.e., Red Hill and REGAL ASIAN go up and down completely randomly.
Pair Corralation between Red Hill and REGAL ASIAN
Assuming the 90 days trading horizon Red Hill Iron is expected to generate 2.0 times more return on investment than REGAL ASIAN. However, Red Hill is 2.0 times more volatile than REGAL ASIAN INVESTMENTS. It trades about 0.02 of its potential returns per unit of risk. REGAL ASIAN INVESTMENTS is currently generating about 0.04 per unit of risk. If you would invest 317.00 in Red Hill Iron on November 27, 2024 and sell it today you would earn a total of 33.00 from holding Red Hill Iron or generate 10.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Red Hill Iron vs. REGAL ASIAN INVESTMENTS
Performance |
| Timeline |
| Red Hill Iron |
| REGAL ASIAN INVESTMENTS |
Red Hill and REGAL ASIAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Red Hill and REGAL ASIAN
The main advantage of trading using opposite Red Hill and REGAL ASIAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Red Hill position performs unexpectedly, REGAL ASIAN 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 REGAL ASIAN will offset losses from the drop in REGAL ASIAN's long position.| Red Hill vs. Saferoads Holdings | Red Hill vs. Galena Mining | Red Hill vs. Gateway Mining | Red Hill vs. Globe Metals Mining |
| REGAL ASIAN vs. Bisalloy Steel Group | REGAL ASIAN vs. EMvision Medical Devices | REGAL ASIAN vs. Pearl Gull Iron | REGAL ASIAN vs. EROAD |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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