Correlation Between 2S Metal and G J
Can any of the company-specific risk be diversified away by investing in both 2S Metal and G J 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 2S Metal and G J into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 2S Metal Public and G J Steel, you can compare the effects of market volatilities on 2S Metal and G J 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 2S Metal with a short position of G J. Check out your portfolio center. Please also check ongoing floating volatility patterns of 2S Metal and G J.
Diversification Opportunities for 2S Metal and G J
Modest diversification
The 3 months correlation between 2S Metal and GJS is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding 2S Metal Public and G J Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G J Steel and 2S Metal 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 2S Metal Public are associated (or correlated) with G J. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G J Steel has no effect on the direction of 2S Metal i.e., 2S Metal and G J go up and down completely randomly.
Pair Corralation between 2S Metal and G J
Assuming the 90 days horizon 2S Metal is expected to generate 150.88 times less return on investment than G J. But when comparing it to its historical volatility, 2S Metal Public is 42.61 times less risky than G J. It trades about 0.01 of its potential returns per unit of risk. G J Steel is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 34.00 in G J Steel on August 31, 2024 and sell it today you would lose (18.00) from holding G J Steel or give up 52.94% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
2S Metal Public vs. G J Steel
Performance |
| Timeline |
| 2S Metal Public |
| G J Steel |
2S Metal and G J Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 2S Metal and G J
The main advantage of trading using opposite 2S Metal and G J positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 2S Metal position performs unexpectedly, G J 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 G J will offset losses from the drop in G J's long position.| 2S Metal vs. Diamond Building Products | 2S Metal vs. MCS Steel Public | 2S Metal vs. Asia Green Energy | 2S Metal vs. Hwa Fong Rubber |
| G J vs. POSCO Thainox Public | G J vs. Aqua Public | G J vs. Better World Green | G J vs. Eternal Energy Public |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
Other Complementary Tools
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |