Correlation Between Bluescope Steel and Peel Mining
Can any of the company-specific risk be diversified away by investing in both Bluescope Steel and Peel Mining 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 Peel Mining into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bluescope Steel and Peel Mining, you can compare the effects of market volatilities on Bluescope Steel and Peel Mining 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 Peel Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bluescope Steel and Peel Mining.
Diversification Opportunities for Bluescope Steel and Peel Mining
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Bluescope and Peel is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Bluescope Steel and Peel Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Peel Mining 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 Peel Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Peel Mining has no effect on the direction of Bluescope Steel i.e., Bluescope Steel and Peel Mining go up and down completely randomly.
Pair Corralation between Bluescope Steel and Peel Mining
Assuming the 90 days trading horizon Bluescope Steel is expected to generate 0.38 times more return on investment than Peel Mining. However, Bluescope Steel is 2.63 times less risky than Peel Mining. It trades about 0.46 of its potential returns per unit of risk. Peel Mining is currently generating about 0.13 per unit of risk. If you would invest 1,884 in Bluescope Steel on November 3, 2024 and sell it today you would earn a total of 245.00 from holding Bluescope Steel or generate 13.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bluescope Steel vs. Peel Mining
Performance |
| Timeline |
| Bluescope Steel |
| Peel Mining |
Bluescope Steel and Peel Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bluescope Steel and Peel Mining
The main advantage of trading using opposite Bluescope Steel and Peel Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bluescope Steel position performs unexpectedly, Peel Mining 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 Peel Mining will offset losses from the drop in Peel Mining's long position.| Bluescope Steel vs. Platinum Asia Investments | Bluescope Steel vs. M3 Mining | Bluescope Steel vs. Duketon Mining | Bluescope Steel vs. Hotel Property Investments |
| Peel Mining vs. Fisher Paykel Healthcare | Peel Mining vs. Health and Plant | Peel Mining vs. Oneview Healthcare PLC | Peel Mining vs. Charter Hall Retail |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Stocks Directory Find actively traded stocks across global markets | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |