Correlation Between Gaztransport Technigaz and ANGANG STEEL
Can any of the company-specific risk be diversified away by investing in both Gaztransport Technigaz and ANGANG 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 Gaztransport Technigaz and ANGANG STEEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gaztransport Technigaz SA and ANGANG STEEL H , you can compare the effects of market volatilities on Gaztransport Technigaz and ANGANG 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 Gaztransport Technigaz with a short position of ANGANG STEEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gaztransport Technigaz and ANGANG STEEL.
Diversification Opportunities for Gaztransport Technigaz and ANGANG STEEL
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Gaztransport and ANGANG is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Gaztransport Technigaz SA and ANGANG STEEL H in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANGANG STEEL H and Gaztransport Technigaz 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 Gaztransport Technigaz SA are associated (or correlated) with ANGANG STEEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANGANG STEEL H has no effect on the direction of Gaztransport Technigaz i.e., Gaztransport Technigaz and ANGANG STEEL go up and down completely randomly.
Pair Corralation between Gaztransport Technigaz and ANGANG STEEL
Assuming the 90 days horizon Gaztransport Technigaz SA is expected to generate 0.58 times more return on investment than ANGANG STEEL. However, Gaztransport Technigaz SA is 1.72 times less risky than ANGANG STEEL. It trades about 0.15 of its potential returns per unit of risk. ANGANG STEEL H is currently generating about 0.06 per unit of risk. If you would invest 13,376 in Gaztransport Technigaz SA on October 30, 2024 and sell it today you would earn a total of 1,454 from holding Gaztransport Technigaz SA or generate 10.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gaztransport Technigaz SA vs. ANGANG STEEL H
Performance |
| Timeline |
| Gaztransport Technigaz |
| ANGANG STEEL H |
Gaztransport Technigaz and ANGANG STEEL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gaztransport Technigaz and ANGANG STEEL
The main advantage of trading using opposite Gaztransport Technigaz and ANGANG STEEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gaztransport Technigaz position performs unexpectedly, ANGANG 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 ANGANG STEEL will offset losses from the drop in ANGANG STEEL's long position.| Gaztransport Technigaz vs. Cass Information Systems | Gaztransport Technigaz vs. Automatic Data Processing | Gaztransport Technigaz vs. Alibaba Health Information | Gaztransport Technigaz vs. THAI BEVERAGE |
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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