Correlation Between Strix Group and China Coal
Can any of the company-specific risk be diversified away by investing in both Strix Group and China 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 Strix Group and China Coal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Strix Group Plc and China Coal Energy, you can compare the effects of market volatilities on Strix Group and China 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 Strix Group with a short position of China Coal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Strix Group and China Coal.
Diversification Opportunities for Strix Group and China Coal
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Strix and China is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Strix Group Plc and China Coal Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Coal Energy and Strix Group 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 Strix Group Plc are associated (or correlated) with China Coal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Coal Energy has no effect on the direction of Strix Group i.e., Strix Group and China Coal go up and down completely randomly.
Pair Corralation between Strix Group and China Coal
Assuming the 90 days horizon Strix Group Plc is expected to under-perform the China Coal. In addition to that, Strix Group is 1.36 times more volatile than China Coal Energy. It trades about -0.4 of its total potential returns per unit of risk. China Coal Energy is currently generating about -0.01 per unit of volatility. If you would invest 115.00 in China Coal Energy on September 18, 2024 and sell it today you would lose (1.00) from holding China Coal Energy or give up 0.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Strix Group Plc vs. China Coal Energy
Performance |
| Timeline |
| Strix Group Plc |
| China Coal Energy |
Strix Group and China Coal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Strix Group and China Coal
The main advantage of trading using opposite Strix Group and China Coal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Strix Group position performs unexpectedly, China 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 China Coal will offset losses from the drop in China Coal's long position.| Strix Group vs. Sunny Optical Technology | Strix Group vs. Hubbell Incorporated | Strix Group vs. TDK Corporation | Strix Group vs. Superior Plus Corp |
| China Coal vs. CHINA SHENHUA ENA | China Coal vs. Yancoal Australia | China Coal vs. Banpu PCL | China Coal vs. CONSOL Energy |
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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