Correlation Between Rubberex M and CSC Steel
Can any of the company-specific risk be diversified away by investing in both Rubberex M and CSC Steel 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 Rubberex M and CSC Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rubberex M and CSC Steel Holdings, you can compare the effects of market volatilities on Rubberex M and CSC Steel 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 Rubberex M with a short position of CSC Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rubberex M and CSC Steel.
Diversification Opportunities for Rubberex M and CSC Steel
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Rubberex and CSC is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Rubberex M and CSC Steel Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CSC Steel Holdings and Rubberex M 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 Rubberex M are associated (or correlated) with CSC Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CSC Steel Holdings has no effect on the direction of Rubberex M i.e., Rubberex M and CSC Steel go up and down completely randomly.
Pair Corralation between Rubberex M and CSC Steel
Assuming the 90 days trading horizon Rubberex M is expected to under-perform the CSC Steel. In addition to that, Rubberex M is 2.78 times more volatile than CSC Steel Holdings. It trades about -0.02 of its total potential returns per unit of risk. CSC Steel Holdings is currently generating about 0.0 per unit of volatility. If you would invest 115.00 in CSC Steel Holdings on November 5, 2024 and sell it today you would lose (3.00) from holding CSC Steel Holdings or give up 2.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.59% |
| Values | Daily Returns |
Rubberex M vs. CSC Steel Holdings
Performance |
| Timeline |
| Rubberex M |
| CSC Steel Holdings |
Rubberex M and CSC Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rubberex M and CSC Steel
The main advantage of trading using opposite Rubberex M and CSC Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rubberex M position performs unexpectedly, CSC Steel 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 CSC Steel will offset losses from the drop in CSC Steel's long position.| Rubberex M vs. Hartalega Holdings Bhd | Rubberex M vs. Kossan Rubber Industries | Rubberex M vs. Supermax Bhd |
| CSC Steel vs. Dnonce Tech Bhd | CSC Steel vs. TAS Offshore Bhd | CSC Steel vs. Cosmos Technology International | CSC Steel vs. Kobay Tech Bhd |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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