Correlation Between Aperam SA and Plasticos Compuestos
Can any of the company-specific risk be diversified away by investing in both Aperam SA and Plasticos Compuestos 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 Aperam SA and Plasticos Compuestos into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aperam SA and Plasticos Compuestos SA, you can compare the effects of market volatilities on Aperam SA and Plasticos Compuestos 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 Aperam SA with a short position of Plasticos Compuestos. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aperam SA and Plasticos Compuestos.
Diversification Opportunities for Aperam SA and Plasticos Compuestos
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aperam and Plasticos is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Aperam SA and Plasticos Compuestos SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plasticos Compuestos and Aperam SA 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 Aperam SA are associated (or correlated) with Plasticos Compuestos. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plasticos Compuestos has no effect on the direction of Aperam SA i.e., Aperam SA and Plasticos Compuestos go up and down completely randomly.
Pair Corralation between Aperam SA and Plasticos Compuestos
Assuming the 90 days trading horizon Aperam SA is expected to generate 1.43 times more return on investment than Plasticos Compuestos. However, Aperam SA is 1.43 times more volatile than Plasticos Compuestos SA. It trades about 0.24 of its potential returns per unit of risk. Plasticos Compuestos SA is currently generating about 0.34 per unit of risk. If you would invest 2,453 in Aperam SA on September 1, 2024 and sell it today you would earn a total of 271.00 from holding Aperam SA or generate 11.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aperam SA vs. Plasticos Compuestos SA
Performance |
| Timeline |
| Aperam SA |
| Plasticos Compuestos |
Aperam SA and Plasticos Compuestos Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aperam SA and Plasticos Compuestos
The main advantage of trading using opposite Aperam SA and Plasticos Compuestos positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aperam SA position performs unexpectedly, Plasticos Compuestos 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 Plasticos Compuestos will offset losses from the drop in Plasticos Compuestos' long position.| Aperam SA vs. Ebro Foods | Aperam SA vs. Atrys Health SL | Aperam SA vs. Atresmedia Corporacin de | Aperam SA vs. Hispanotels Inversiones SOCIMI |
| Plasticos Compuestos vs. Petroleo Brasileiro SA | Plasticos Compuestos vs. Vale SA | Plasticos Compuestos vs. Banco Santander | Plasticos Compuestos vs. Telefonica |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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