Correlation Between Collins Foods and De Grey
Can any of the company-specific risk be diversified away by investing in both Collins Foods and De Grey 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 Collins Foods and De Grey into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Collins Foods and De Grey Mining, you can compare the effects of market volatilities on Collins Foods and De Grey 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 Collins Foods with a short position of De Grey. Check out your portfolio center. Please also check ongoing floating volatility patterns of Collins Foods and De Grey.
Diversification Opportunities for Collins Foods and De Grey
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Collins and DEG is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Collins Foods and De Grey Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on De Grey Mining and Collins Foods 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 Collins Foods are associated (or correlated) with De Grey. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of De Grey Mining has no effect on the direction of Collins Foods i.e., Collins Foods and De Grey go up and down completely randomly.
Pair Corralation between Collins Foods and De Grey
Assuming the 90 days trading horizon Collins Foods is expected to under-perform the De Grey. But the stock apears to be less risky and, when comparing its historical volatility, Collins Foods is 5.57 times less risky than De Grey. The stock trades about -0.61 of its potential returns per unit of risk. The De Grey Mining is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 150.00 in De Grey Mining on September 24, 2024 and sell it today you would earn a total of 30.00 from holding De Grey Mining or generate 20.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 95.45% |
Values | Daily Returns |
Collins Foods vs. De Grey Mining
Performance |
Timeline |
Collins Foods |
De Grey Mining |
Collins Foods and De Grey Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Collins Foods and De Grey
The main advantage of trading using opposite Collins Foods and De Grey positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Collins Foods position performs unexpectedly, De Grey 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 De Grey will offset losses from the drop in De Grey's long position.Collins Foods vs. Group 6 Metals | Collins Foods vs. DY6 Metals | Collins Foods vs. Flagship Investments | Collins Foods vs. Platinum Asia Investments |
De Grey vs. DY6 Metals | De Grey vs. Centuria Industrial Reit | De Grey vs. oOhMedia | De Grey vs. Collins Foods |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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