Correlation Between BLUESCOPE STEEL and XLMedia PLC
Can any of the company-specific risk be diversified away by investing in both BLUESCOPE STEEL and XLMedia PLC 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 XLMedia PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BLUESCOPE STEEL and XLMedia PLC, you can compare the effects of market volatilities on BLUESCOPE STEEL and XLMedia PLC 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 XLMedia PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of BLUESCOPE STEEL and XLMedia PLC.
Diversification Opportunities for BLUESCOPE STEEL and XLMedia PLC
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BLUESCOPE and XLMedia is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding BLUESCOPE STEEL and XLMedia PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on XLMedia PLC 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 are associated (or correlated) with XLMedia PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of XLMedia PLC has no effect on the direction of BLUESCOPE STEEL i.e., BLUESCOPE STEEL and XLMedia PLC go up and down completely randomly.
Pair Corralation between BLUESCOPE STEEL and XLMedia PLC
If you would invest 1,230 in BLUESCOPE STEEL on September 5, 2024 and sell it today you would earn a total of 120.00 from holding BLUESCOPE STEEL or generate 9.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
BLUESCOPE STEEL vs. XLMedia PLC
Performance |
| Timeline |
| BLUESCOPE STEEL |
| XLMedia PLC |
BLUESCOPE STEEL and XLMedia PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BLUESCOPE STEEL and XLMedia PLC
The main advantage of trading using opposite BLUESCOPE STEEL and XLMedia PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BLUESCOPE STEEL position performs unexpectedly, XLMedia PLC 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 XLMedia PLC will offset losses from the drop in XLMedia PLC's long position.| BLUESCOPE STEEL vs. Apple Inc | BLUESCOPE STEEL vs. Apple Inc | BLUESCOPE STEEL vs. Apple Inc | BLUESCOPE STEEL vs. Apple Inc |
| XLMedia PLC vs. BlueScope Steel Limited | XLMedia PLC vs. MINCO SILVER | XLMedia PLC vs. BLUESCOPE STEEL | XLMedia PLC vs. GALENA MINING LTD |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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