Correlation Between BlueScope Steel and Bilibili
Can any of the company-specific risk be diversified away by investing in both BlueScope Steel and Bilibili 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 BlueScope Steel and Bilibili into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BlueScope Steel Limited and Bilibili, you can compare the effects of market volatilities on BlueScope Steel and Bilibili 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 BlueScope Steel with a short position of Bilibili. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlueScope Steel and Bilibili.
Diversification Opportunities for BlueScope Steel and Bilibili
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between BlueScope and Bilibili is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding BlueScope Steel Limited and Bilibili in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bilibili and BlueScope 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 BlueScope Steel Limited are associated (or correlated) with Bilibili. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bilibili has no effect on the direction of BlueScope Steel i.e., BlueScope Steel and Bilibili go up and down completely randomly.
Pair Corralation between BlueScope Steel and Bilibili
Assuming the 90 days horizon BlueScope Steel is expected to generate 3.3 times less return on investment than Bilibili. But when comparing it to its historical volatility, BlueScope Steel Limited is 2.32 times less risky than Bilibili. It trades about 0.02 of its potential returns per unit of risk. Bilibili is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,420 in Bilibili on October 24, 2024 and sell it today you would earn a total of 140.00 from holding Bilibili or generate 9.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.76% |
| Values | Daily Returns |
BlueScope Steel Limited vs. Bilibili
Performance |
| Timeline |
| BlueScope Steel |
| Bilibili |
BlueScope Steel and Bilibili Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BlueScope Steel and Bilibili
The main advantage of trading using opposite BlueScope Steel and Bilibili positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BlueScope Steel position performs unexpectedly, Bilibili 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 Bilibili will offset losses from the drop in Bilibili's long position.| BlueScope Steel vs. Ryanair Holdings plc | BlueScope Steel vs. SIERRA METALS | BlueScope Steel vs. SYSTEMAIR AB | BlueScope Steel vs. Fair Isaac Corp |
| Bilibili vs. BlueScope Steel Limited | Bilibili vs. Firan Technology Group | Bilibili vs. Kingdee International Software | Bilibili vs. Easy Software AG |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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