Correlation Between Yanzhou Coal and Seadrill
Can any of the company-specific risk be diversified away by investing in both Yanzhou Coal and Seadrill 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 Yanzhou Coal and Seadrill into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yanzhou Coal Mining and Seadrill Limited, you can compare the effects of market volatilities on Yanzhou Coal and Seadrill 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 Yanzhou Coal with a short position of Seadrill. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yanzhou Coal and Seadrill.
Diversification Opportunities for Yanzhou Coal and Seadrill
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Yanzhou and Seadrill is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Yanzhou Coal Mining and Seadrill Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seadrill Limited and Yanzhou Coal 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 Yanzhou Coal Mining are associated (or correlated) with Seadrill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seadrill Limited has no effect on the direction of Yanzhou Coal i.e., Yanzhou Coal and Seadrill go up and down completely randomly.
Pair Corralation between Yanzhou Coal and Seadrill
Assuming the 90 days horizon Yanzhou Coal Mining is expected to generate 2.92 times more return on investment than Seadrill. However, Yanzhou Coal is 2.92 times more volatile than Seadrill Limited. It trades about 0.03 of its potential returns per unit of risk. Seadrill Limited is currently generating about 0.01 per unit of risk. If you would invest 1,255 in Yanzhou Coal Mining on September 4, 2024 and sell it today you would lose (78.00) from holding Yanzhou Coal Mining or give up 6.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.17% |
| Values | Daily Returns |
Yanzhou Coal Mining vs. Seadrill Limited
Performance |
| Timeline |
| Yanzhou Coal Mining |
| Seadrill Limited |
Yanzhou Coal and Seadrill Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yanzhou Coal and Seadrill
The main advantage of trading using opposite Yanzhou Coal and Seadrill positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yanzhou Coal position performs unexpectedly, Seadrill 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 Seadrill will offset losses from the drop in Seadrill's long position.| Yanzhou Coal vs. Indo Tambangraya Megah | Yanzhou Coal vs. Bukit Asam Tbk | Yanzhou Coal vs. Geo Energy Resources | Yanzhou Coal vs. Yancoal Australia |
| Seadrill vs. Precision Drilling | Seadrill vs. Sable Offshore Corp | Seadrill vs. Patterson UTI Energy | Seadrill vs. Borr Drilling |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |