Correlation Between CSC Steel and SFP Tech
Can any of the company-specific risk be diversified away by investing in both CSC Steel and SFP Tech 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 CSC Steel and SFP Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CSC Steel Holdings and SFP Tech Holdings, you can compare the effects of market volatilities on CSC Steel and SFP Tech 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 CSC Steel with a short position of SFP Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of CSC Steel and SFP Tech.
Diversification Opportunities for CSC Steel and SFP Tech
Very good diversification
The 3 months correlation between CSC and SFP is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding CSC Steel Holdings and SFP Tech Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SFP Tech Holdings and CSC Steel 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 CSC Steel Holdings are associated (or correlated) with SFP Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SFP Tech Holdings has no effect on the direction of CSC Steel i.e., CSC Steel and SFP Tech go up and down completely randomly.
Pair Corralation between CSC Steel and SFP Tech
Assuming the 90 days trading horizon CSC Steel Holdings is expected to generate 0.37 times more return on investment than SFP Tech. However, CSC Steel Holdings is 2.68 times less risky than SFP Tech. It trades about -0.47 of its potential returns per unit of risk. SFP Tech Holdings is currently generating about -0.21 per unit of risk. If you would invest 120.00 in CSC Steel Holdings on November 3, 2024 and sell it today you would lose (8.00) from holding CSC Steel Holdings or give up 6.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CSC Steel Holdings vs. SFP Tech Holdings
Performance |
| Timeline |
| CSC Steel Holdings |
| SFP Tech Holdings |
CSC Steel and SFP Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CSC Steel and SFP Tech
The main advantage of trading using opposite CSC Steel and SFP Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CSC Steel position performs unexpectedly, SFP Tech 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 SFP Tech will offset losses from the drop in SFP Tech's long position.| CSC Steel vs. Shangri La Hotels | CSC Steel vs. Sports Toto Berhad | CSC Steel vs. Media Prima Bhd | CSC Steel vs. Eonmetall Group Bhd |
| SFP Tech vs. Diversified Gateway Solutions | SFP Tech vs. Dataprep Holdings Bhd | SFP Tech vs. Senheng New Retail | SFP Tech vs. Bank Islam Malaysia |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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