Correlation Between Super Retail and Coronado Global
Can any of the company-specific risk be diversified away by investing in both Super Retail and Coronado Global 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 Super Retail and Coronado Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Super Retail Group and Coronado Global Resources, you can compare the effects of market volatilities on Super Retail and Coronado Global 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 Super Retail with a short position of Coronado Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Super Retail and Coronado Global.
Diversification Opportunities for Super Retail and Coronado Global
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Super and Coronado is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Super Retail Group and Coronado Global Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coronado Global Resources and Super Retail 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 Super Retail Group are associated (or correlated) with Coronado Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coronado Global Resources has no effect on the direction of Super Retail i.e., Super Retail and Coronado Global go up and down completely randomly.
Pair Corralation between Super Retail and Coronado Global
Assuming the 90 days trading horizon Super Retail Group is expected to generate 0.59 times more return on investment than Coronado Global. However, Super Retail Group is 1.69 times less risky than Coronado Global. It trades about 0.0 of its potential returns per unit of risk. Coronado Global Resources is currently generating about -0.02 per unit of risk. If you would invest 1,510 in Super Retail Group on September 3, 2024 and sell it today you would lose (37.00) from holding Super Retail Group or give up 2.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Super Retail Group vs. Coronado Global Resources
Performance |
| Timeline |
| Super Retail Group |
| Coronado Global Resources |
Super Retail and Coronado Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Super Retail and Coronado Global
The main advantage of trading using opposite Super Retail and Coronado Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Super Retail position performs unexpectedly, Coronado Global 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 Coronado Global will offset losses from the drop in Coronado Global's long position.| Super Retail vs. Westpac Banking | Super Retail vs. Champion Iron | Super Retail vs. iShares Global Healthcare | Super Retail vs. Peel Mining |
| Coronado Global vs. Queste Communications | Coronado Global vs. BKI Investment | Coronado Global vs. Treasury Wine Estates | Coronado Global vs. Sandon Capital Investments |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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