Correlation Between Yancoal Australia and Banpu PCL
Can any of the company-specific risk be diversified away by investing in both Yancoal Australia and Banpu PCL 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 Yancoal Australia and Banpu PCL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yancoal Australia and Banpu PCL, you can compare the effects of market volatilities on Yancoal Australia and Banpu PCL 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 Yancoal Australia with a short position of Banpu PCL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yancoal Australia and Banpu PCL.
Diversification Opportunities for Yancoal Australia and Banpu PCL
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Yancoal and Banpu is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Yancoal Australia and Banpu PCL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Banpu PCL and Yancoal Australia 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 Yancoal Australia are associated (or correlated) with Banpu PCL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Banpu PCL has no effect on the direction of Yancoal Australia i.e., Yancoal Australia and Banpu PCL go up and down completely randomly.
Pair Corralation between Yancoal Australia and Banpu PCL
Assuming the 90 days trading horizon Yancoal Australia is expected to under-perform the Banpu PCL. But the stock apears to be less risky and, when comparing its historical volatility, Yancoal Australia is 2.43 times less risky than Banpu PCL. The stock trades about -0.17 of its potential returns per unit of risk. The Banpu PCL is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 15.00 in Banpu PCL on September 23, 2024 and sell it today you would earn a total of 0.00 from holding Banpu PCL or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Yancoal Australia vs. Banpu PCL
Performance |
Timeline |
Yancoal Australia |
Banpu PCL |
Yancoal Australia and Banpu PCL Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Yancoal Australia and Banpu PCL
The main advantage of trading using opposite Yancoal Australia and Banpu PCL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yancoal Australia position performs unexpectedly, Banpu PCL 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 Banpu PCL will offset losses from the drop in Banpu PCL's long position.Yancoal Australia vs. CHINA SHENHUA ENA | Yancoal Australia vs. China Coal Energy | Yancoal Australia vs. Banpu PCL | Yancoal Australia vs. CONSOL Energy |
Banpu PCL vs. CHINA SHENHUA ENA | Banpu PCL vs. China Coal Energy | Banpu PCL vs. Yancoal Australia | Banpu PCL vs. CONSOL Energy |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |