Correlation Between ArcelorMittal and ArcelorMittal
Can any of the company-specific risk be diversified away by investing in both ArcelorMittal and ArcelorMittal 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 ArcelorMittal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ArcelorMittal and ArcelorMittal SA, you can compare the effects of market volatilities on ArcelorMittal and ArcelorMittal 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 ArcelorMittal. Check out your portfolio center. Please also check ongoing floating volatility patterns of ArcelorMittal and ArcelorMittal.
Diversification Opportunities for ArcelorMittal and ArcelorMittal
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ArcelorMittal and ArcelorMittal is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding ArcelorMittal and ArcelorMittal SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ArcelorMittal SA 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 are associated (or correlated) with ArcelorMittal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ArcelorMittal SA has no effect on the direction of ArcelorMittal i.e., ArcelorMittal and ArcelorMittal go up and down completely randomly.
Pair Corralation between ArcelorMittal and ArcelorMittal
Assuming the 90 days trading horizon ArcelorMittal is expected to generate 1.34 times less return on investment than ArcelorMittal. In addition to that, ArcelorMittal is 1.08 times more volatile than ArcelorMittal SA. It trades about 0.0 of its total potential returns per unit of risk. ArcelorMittal SA is currently generating about 0.01 per unit of volatility. If you would invest 2,455 in ArcelorMittal SA on August 25, 2024 and sell it today you would lose (59.00) from holding ArcelorMittal SA or give up 2.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ArcelorMittal vs. ArcelorMittal SA
Performance |
| Timeline |
| ArcelorMittal |
| ArcelorMittal SA |
ArcelorMittal and ArcelorMittal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ArcelorMittal and ArcelorMittal
The main advantage of trading using opposite ArcelorMittal and ArcelorMittal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ArcelorMittal position performs unexpectedly, ArcelorMittal 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 ArcelorMittal will offset losses from the drop in ArcelorMittal's long position.| ArcelorMittal vs. Ming Le Sports | ArcelorMittal vs. ANTA SPORTS PRODUCT | ArcelorMittal vs. Commercial Vehicle Group | ArcelorMittal vs. Merit Medical Systems |
| ArcelorMittal vs. ArcelorMittal | ArcelorMittal vs. Nippon Steel | ArcelorMittal vs. NIPPON STEEL SPADR | ArcelorMittal vs. POSCO 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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