Correlation Between BlueScope Steel and AEON MALL
Can any of the company-specific risk be diversified away by investing in both BlueScope Steel and AEON MALL 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 AEON MALL 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 AEON MALL LTD, you can compare the effects of market volatilities on BlueScope Steel and AEON MALL 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 AEON MALL. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlueScope Steel and AEON MALL.
Diversification Opportunities for BlueScope Steel and AEON MALL
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between BlueScope and AEON is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding BlueScope Steel Limited and AEON MALL LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AEON MALL LTD 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 AEON MALL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AEON MALL LTD has no effect on the direction of BlueScope Steel i.e., BlueScope Steel and AEON MALL go up and down completely randomly.
Pair Corralation between BlueScope Steel and AEON MALL
Assuming the 90 days horizon BlueScope Steel is expected to generate 3.26 times less return on investment than AEON MALL. In addition to that, BlueScope Steel is 1.82 times more volatile than AEON MALL LTD. It trades about 0.01 of its total potential returns per unit of risk. AEON MALL LTD is currently generating about 0.06 per unit of volatility. If you would invest 1,210 in AEON MALL LTD on September 13, 2024 and sell it today you would earn a total of 20.00 from holding AEON MALL LTD or generate 1.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BlueScope Steel Limited vs. AEON MALL LTD
Performance |
| Timeline |
| BlueScope Steel |
| AEON MALL LTD |
BlueScope Steel and AEON MALL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BlueScope Steel and AEON MALL
The main advantage of trading using opposite BlueScope Steel and AEON MALL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BlueScope Steel position performs unexpectedly, AEON MALL 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 AEON MALL will offset losses from the drop in AEON MALL's long position.| BlueScope Steel vs. United Insurance Holdings | BlueScope Steel vs. Insurance Australia Group | BlueScope Steel vs. LPKF Laser Electronics | BlueScope Steel vs. Ping An Insurance |
| AEON MALL vs. Shenandoah Telecommunications | AEON MALL vs. REGAL ASIAN INVESTMENTS | AEON MALL vs. Consolidated Communications Holdings | AEON MALL vs. Mobilezone Holding 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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