Correlation Between Ramaco Resources and Bill

Can any of the company-specific risk be diversified away by investing in both Ramaco Resources and Bill 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 Ramaco Resources and Bill into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Ramaco Resources and Bill Com Holdings, you can compare the effects of market volatilities on Ramaco Resources and Bill 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 Ramaco Resources with a short position of Bill. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ramaco Resources and Bill.

Diversification Opportunities for Ramaco Resources and Bill

-0.17

Correlation Coefficient

Ramaco Resources  Bill

Good diversification

The 3 months correlation between Ramaco and Bill is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Ramaco Resources and Bill Com Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bill Com Holdings and Ramaco Resources 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 Ramaco Resources are associated (or correlated) with Bill. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bill Com Holdings has no effect on the direction of Ramaco Resources i.e., Ramaco Resources and Bill go up and down completely randomly.

Pair Corralation between Ramaco Resources and Bill

Assuming the 90 days horizon Ramaco Resources is expected to generate 1.15 times more return on investment than Bill. However, Ramaco Resources is 1.15 times more volatile than Bill Com Holdings. It trades about -0.11 of its potential returns per unit of risk. Bill Com Holdings is currently generating about -0.17 per unit of risk. If you would invest  1,032  in Ramaco Resources on October 10, 2024 and sell it today you would lose (76.00) from holding Ramaco Resources or give up 7.36% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Ramaco Resources  vs.  Bill Com Holdings

Ramaco Resources

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ramaco Resources has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Bill Com Holdings

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Bill Com Holdings are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite quite fragile essential indicators, Bill disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Ramaco Resources and Bill

The main advantage of trading using opposite Ramaco Resources and Bill positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ramaco Resources position performs unexpectedly, Bill 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 Bill will offset losses from the drop in Bill's long position.

The idea behind Ramaco Resources and Bill Com Holdings pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.