Correlation Between East Africa and NUCOR
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By analyzing existing cross correlation between East Africa Metals and NUCOR P 52, you can compare the effects of market volatilities on East Africa and NUCOR 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 East Africa with a short position of NUCOR. Check out your portfolio center. Please also check ongoing floating volatility patterns of East Africa and NUCOR.
Diversification Opportunities for East Africa and NUCOR
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between East and NUCOR is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding East Africa Metals and NUCOR P 52 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NUCOR P 52 and East Africa 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 East Africa Metals are associated (or correlated) with NUCOR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NUCOR P 52 has no effect on the direction of East Africa i.e., East Africa and NUCOR go up and down completely randomly.
Pair Corralation between East Africa and NUCOR
Assuming the 90 days horizon East Africa Metals is expected to generate 9.45 times more return on investment than NUCOR. However, East Africa is 9.45 times more volatile than NUCOR P 52. It trades about 0.07 of its potential returns per unit of risk. NUCOR P 52 is currently generating about 0.02 per unit of risk. If you would invest 7.00 in East Africa Metals on September 14, 2024 and sell it today you would earn a total of 4.00 from holding East Africa Metals or generate 57.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 31.97% |
| Values | Daily Returns |
East Africa Metals vs. NUCOR P 52
Performance |
| Timeline |
| East Africa Metals |
| NUCOR P 52 |
East Africa and NUCOR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with East Africa and NUCOR
The main advantage of trading using opposite East Africa and NUCOR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if East Africa position performs unexpectedly, NUCOR 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 NUCOR will offset losses from the drop in NUCOR's long position.| East Africa vs. Pasinex Resources Limited | East Africa vs. Commander Resources | East Africa vs. Forsys Metals Corp | East Africa vs. American CuMo Mining |
| NUCOR vs. Valneva SE ADR | NUCOR vs. East Africa Metals | NUCOR vs. Nuvalent | NUCOR vs. Red Branch Technologies |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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