Correlation Between ArcelorMittal and Align Technology
Can any of the company-specific risk be diversified away by investing in both ArcelorMittal and Align Technology 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 ArcelorMittal and Align Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ArcelorMittal SA and Align Technology, you can compare the effects of market volatilities on ArcelorMittal and Align Technology 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 ArcelorMittal with a short position of Align Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of ArcelorMittal and Align Technology.
Diversification Opportunities for ArcelorMittal and Align Technology
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ArcelorMittal and Align is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ArcelorMittal SA and Align Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Align Technology and ArcelorMittal 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 ArcelorMittal SA are associated (or correlated) with Align Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Align Technology has no effect on the direction of ArcelorMittal i.e., ArcelorMittal and Align Technology go up and down completely randomly.
Pair Corralation between ArcelorMittal and Align Technology
Assuming the 90 days trading horizon ArcelorMittal is expected to generate 5.86 times less return on investment than Align Technology. In addition to that, ArcelorMittal is 1.35 times more volatile than Align Technology. It trades about 0.04 of its total potential returns per unit of risk. Align Technology is currently generating about 0.31 per unit of volatility. If you would invest 31,230 in Align Technology on August 30, 2024 and sell it today you would earn a total of 3,624 from holding Align Technology or generate 11.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ArcelorMittal SA vs. Align Technology
Performance |
| Timeline |
| ArcelorMittal SA |
| Align Technology |
ArcelorMittal and Align Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ArcelorMittal and Align Technology
The main advantage of trading using opposite ArcelorMittal and Align Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ArcelorMittal position performs unexpectedly, Align Technology 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 Align Technology will offset losses from the drop in Align Technology's long position.| ArcelorMittal vs. Bread Financial Holdings | ArcelorMittal vs. Ross Stores | ArcelorMittal vs. salesforce inc | ArcelorMittal vs. NXP Semiconductors NV |
| Align Technology vs. G2D Investments | Align Technology vs. UnitedHealth Group Incorporated | Align Technology vs. STMicroelectronics NV | Align Technology vs. MAHLE Metal Leve |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| CEOs Directory Screen CEOs from public companies around the world | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |