Correlation Between Aluminumof China and NEWELL RUBBERMAID
Can any of the company-specific risk be diversified away by investing in both Aluminumof China and NEWELL RUBBERMAID 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 Aluminumof China and NEWELL RUBBERMAID into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aluminum of and NEWELL RUBBERMAID , you can compare the effects of market volatilities on Aluminumof China and NEWELL RUBBERMAID 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 Aluminumof China with a short position of NEWELL RUBBERMAID. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aluminumof China and NEWELL RUBBERMAID.
Diversification Opportunities for Aluminumof China and NEWELL RUBBERMAID
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aluminumof and NEWELL is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Aluminum of and NEWELL RUBBERMAID in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEWELL RUBBERMAID and Aluminumof China 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 Aluminum of are associated (or correlated) with NEWELL RUBBERMAID. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEWELL RUBBERMAID has no effect on the direction of Aluminumof China i.e., Aluminumof China and NEWELL RUBBERMAID go up and down completely randomly.
Pair Corralation between Aluminumof China and NEWELL RUBBERMAID
Assuming the 90 days horizon Aluminum of is expected to generate 0.97 times more return on investment than NEWELL RUBBERMAID. However, Aluminum of is 1.03 times less risky than NEWELL RUBBERMAID. It trades about 0.05 of its potential returns per unit of risk. NEWELL RUBBERMAID is currently generating about 0.0 per unit of risk. If you would invest 32.00 in Aluminum of on November 6, 2024 and sell it today you would earn a total of 29.00 from holding Aluminum of or generate 90.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aluminum of vs. NEWELL RUBBERMAID
Performance |
| Timeline |
| Aluminumof China |
| NEWELL RUBBERMAID |
Aluminumof China and NEWELL RUBBERMAID Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aluminumof China and NEWELL RUBBERMAID
The main advantage of trading using opposite Aluminumof China and NEWELL RUBBERMAID positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aluminumof China position performs unexpectedly, NEWELL RUBBERMAID 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 NEWELL RUBBERMAID will offset losses from the drop in NEWELL RUBBERMAID's long position.| Aluminumof China vs. UNITED RENTALS | Aluminumof China vs. OFFICE DEPOT | Aluminumof China vs. BORR DRILLING NEW | Aluminumof China vs. SCANSOURCE |
| NEWELL RUBBERMAID vs. INTER CARS SA | NEWELL RUBBERMAID vs. Aegean Airlines SA | NEWELL RUBBERMAID vs. Commercial Vehicle Group | NEWELL RUBBERMAID vs. United Airlines Holdings |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |