Correlation Between Westport Fuel and Core Natural
Can any of the company-specific risk be diversified away by investing in both Westport Fuel and Core Natural 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 Westport Fuel and Core Natural into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westport Fuel Systems and Core Natural Resources,, you can compare the effects of market volatilities on Westport Fuel and Core Natural 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 Westport Fuel with a short position of Core Natural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westport Fuel and Core Natural.
Diversification Opportunities for Westport Fuel and Core Natural
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Westport and Core is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Westport Fuel Systems and Core Natural Resources, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Core Natural Resources, and Westport Fuel 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 Westport Fuel Systems are associated (or correlated) with Core Natural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Core Natural Resources, has no effect on the direction of Westport Fuel i.e., Westport Fuel and Core Natural go up and down completely randomly.
Pair Corralation between Westport Fuel and Core Natural
Given the investment horizon of 90 days Westport Fuel Systems is expected to generate 1.57 times more return on investment than Core Natural. However, Westport Fuel is 1.57 times more volatile than Core Natural Resources,. It trades about 0.13 of its potential returns per unit of risk. Core Natural Resources, is currently generating about -0.3 per unit of risk. If you would invest 402.00 in Westport Fuel Systems on November 5, 2024 and sell it today you would earn a total of 35.00 from holding Westport Fuel Systems or generate 8.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Westport Fuel Systems vs. Core Natural Resources,
Performance |
| Timeline |
| Westport Fuel Systems |
| Core Natural Resources, |
Westport Fuel and Core Natural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Westport Fuel and Core Natural
The main advantage of trading using opposite Westport Fuel and Core Natural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westport Fuel position performs unexpectedly, Core Natural 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 Core Natural will offset losses from the drop in Core Natural's long position.| Westport Fuel vs. Foresight Autonomous Holdings | Westport Fuel vs. Hyliion Holdings Corp | Westport Fuel vs. American Axle Manufacturing | Westport Fuel vs. Gentex |
| Core Natural vs. BRC Inc | Core Natural vs. RH | Core Natural vs. Turning Point Brands | Core Natural vs. CDW Corp |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
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