Correlation Between CF Industries and Mesabi Trust
Can any of the company-specific risk be diversified away by investing in both CF Industries and Mesabi Trust 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 CF Industries and Mesabi Trust into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CF Industries Holdings and Mesabi Trust, you can compare the effects of market volatilities on CF Industries and Mesabi Trust 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 CF Industries with a short position of Mesabi Trust. Check out your portfolio center. Please also check ongoing floating volatility patterns of CF Industries and Mesabi Trust.
Diversification Opportunities for CF Industries and Mesabi Trust
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CF Industries and Mesabi is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding CF Industries Holdings and Mesabi Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mesabi Trust and CF Industries 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 CF Industries Holdings are associated (or correlated) with Mesabi Trust. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mesabi Trust has no effect on the direction of CF Industries i.e., CF Industries and Mesabi Trust go up and down completely randomly.
Pair Corralation between CF Industries and Mesabi Trust
Allowing for the 90-day total investment horizon CF Industries Holdings is expected to under-perform the Mesabi Trust. But the stock apears to be less risky and, when comparing its historical volatility, CF Industries Holdings is 2.9 times less risky than Mesabi Trust. The stock trades about -0.13 of its potential returns per unit of risk. The Mesabi Trust is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 2,514 in Mesabi Trust on December 15, 2024 and sell it today you would earn a total of 167.00 from holding Mesabi Trust or generate 6.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CF Industries Holdings vs. Mesabi Trust
Performance |
| Timeline |
| CF Industries Holdings |
| Mesabi Trust |
CF Industries and Mesabi Trust Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CF Industries and Mesabi Trust
The main advantage of trading using opposite CF Industries and Mesabi Trust positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CF Industries position performs unexpectedly, Mesabi Trust 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 Mesabi Trust will offset losses from the drop in Mesabi Trust's long position.| CF Industries vs. Intrepid Potash | ||
| CF Industries vs. E I du | ||
| CF Industries vs. FMC Corporation | ||
| CF Industries vs. Benson Hill, Common |
| Mesabi Trust vs. Olympic Steel | ||
| Mesabi Trust vs. POSCO Holdings | ||
| Mesabi Trust vs. Outokumpu Oyj ADR | ||
| Mesabi Trust vs. Usinas Siderurgicas de |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Stocks Directory Find actively traded stocks across global markets |