Correlation Between Core Natural and Builders FirstSource

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

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

Diversification Opportunities for Core Natural and Builders FirstSource

-0.36

Correlation Coefficient

Core Natural  Builders FirstSource

Very good diversification

The 3 months correlation between Core and Builders is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Core Natural Resources, and Builders FirstSource in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Builders FirstSource and Core Natural 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 Core Natural Resources, are associated (or correlated) with Builders FirstSource. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Builders FirstSource has no effect on the direction of Core Natural i.e., Core Natural and Builders FirstSource go up and down completely randomly.

Pair Corralation between Core Natural and Builders FirstSource

Considering the 90-day investment horizon Core Natural Resources, is expected to generate 1.39 times more return on investment than Builders FirstSource. However, Core Natural is 1.39 times more volatile than Builders FirstSource. It trades about 0.04 of its potential returns per unit of risk. Builders FirstSource is currently generating about -0.25 per unit of risk. If you would invest  7,277  in Core Natural Resources, on August 23, 2025 and sell it today you would earn a total of  379.00  from holding Core Natural Resources, or generate 5.21% return on investment over 90 days.

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

Core Natural Resources,  vs.  Builders FirstSource

Core Natural Resources,

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Core Natural Resources, are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady basic indicators, Core Natural may actually be approaching a critical reversion point that can send shares even higher in December 2025.

Builders FirstSource

Risk-Adjusted Performance

Weakest

Over the last 90 days Builders FirstSource has generated negative risk-adjusted returns adding no value to investors with long positions. Even with uncertain performance in the last few months, the Stock's fundamental indicators remain relatively invariable which may send shares a bit higher in December 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Core Natural and Builders FirstSource

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

The idea behind Core Natural Resources, and Builders FirstSource 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.