Correlation Between Bluescope Steel and ANZ Group
Can any of the company-specific risk be diversified away by investing in both Bluescope Steel and ANZ Group 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 ANZ Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bluescope Steel and ANZ Group Holdings, you can compare the effects of market volatilities on Bluescope Steel and ANZ Group 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 ANZ Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bluescope Steel and ANZ Group.
Diversification Opportunities for Bluescope Steel and ANZ Group
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Bluescope and ANZ is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Bluescope Steel and ANZ Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ANZ Group Holdings 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 ANZ Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ANZ Group Holdings has no effect on the direction of Bluescope Steel i.e., Bluescope Steel and ANZ Group go up and down completely randomly.
Pair Corralation between Bluescope Steel and ANZ Group
Assuming the 90 days trading horizon Bluescope Steel is expected to generate 3.57 times more return on investment than ANZ Group. However, Bluescope Steel is 3.57 times more volatile than ANZ Group Holdings. It trades about 0.07 of its potential returns per unit of risk. ANZ Group Holdings is currently generating about -0.08 per unit of risk. If you would invest 2,158 in Bluescope Steel on September 12, 2024 and sell it today you would earn a total of 58.00 from holding Bluescope Steel or generate 2.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bluescope Steel vs. ANZ Group Holdings
Performance |
| Timeline |
| Bluescope Steel |
| ANZ Group Holdings |
Bluescope Steel and ANZ Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bluescope Steel and ANZ Group
The main advantage of trading using opposite Bluescope Steel and ANZ Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bluescope Steel position performs unexpectedly, ANZ Group 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 ANZ Group will offset losses from the drop in ANZ Group's long position.| Bluescope Steel vs. Truscott Mining Corp | Bluescope Steel vs. Centaurus Metals | Bluescope Steel vs. Carnegie Clean Energy | Bluescope Steel vs. Falcon Metals |
| ANZ Group vs. Aeris Environmental | ANZ Group vs. Bluescope Steel | ANZ Group vs. BKI Investment | ANZ Group vs. Flagship Investments |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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