Correlation Between ALGOMA STEEL and Haier Smart
Can any of the company-specific risk be diversified away by investing in both ALGOMA STEEL and Haier Smart 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 ALGOMA STEEL and Haier Smart into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALGOMA STEEL GROUP and Haier Smart Home, you can compare the effects of market volatilities on ALGOMA STEEL and Haier Smart 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 ALGOMA STEEL with a short position of Haier Smart. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALGOMA STEEL and Haier Smart.
Diversification Opportunities for ALGOMA STEEL and Haier Smart
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between ALGOMA and Haier is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding ALGOMA STEEL GROUP and Haier Smart Home in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haier Smart Home and ALGOMA 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 ALGOMA STEEL GROUP are associated (or correlated) with Haier Smart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haier Smart Home has no effect on the direction of ALGOMA STEEL i.e., ALGOMA STEEL and Haier Smart go up and down completely randomly.
Pair Corralation between ALGOMA STEEL and Haier Smart
Assuming the 90 days horizon ALGOMA STEEL GROUP is expected to generate 1.37 times more return on investment than Haier Smart. However, ALGOMA STEEL is 1.37 times more volatile than Haier Smart Home. It trades about 0.1 of its potential returns per unit of risk. Haier Smart Home is currently generating about 0.05 per unit of risk. If you would invest 712.00 in ALGOMA STEEL GROUP on September 3, 2024 and sell it today you would earn a total of 288.00 from holding ALGOMA STEEL GROUP or generate 40.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ALGOMA STEEL GROUP vs. Haier Smart Home
Performance |
| Timeline |
| ALGOMA STEEL GROUP |
| Haier Smart Home |
ALGOMA STEEL and Haier Smart Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALGOMA STEEL and Haier Smart
The main advantage of trading using opposite ALGOMA STEEL and Haier Smart positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALGOMA STEEL position performs unexpectedly, Haier Smart 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 Haier Smart will offset losses from the drop in Haier Smart's long position.| ALGOMA STEEL vs. ArcelorMittal | ALGOMA STEEL vs. Steel Dynamics | ALGOMA STEEL vs. NIPPON STEEL SPADR | ALGOMA STEEL vs. POSCO Holdings |
| Haier Smart vs. Sixt Leasing SE | Haier Smart vs. ALGOMA STEEL GROUP | Haier Smart vs. Tianjin Capital Environmental | Haier Smart vs. Perma Fix Environmental Services |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |