Correlation Between Metalurgica Gerdau and Dell Technologies
Can any of the company-specific risk be diversified away by investing in both Metalurgica Gerdau and Dell Technologies 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 Metalurgica Gerdau and Dell Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Metalurgica Gerdau SA and Dell Technologies, you can compare the effects of market volatilities on Metalurgica Gerdau and Dell Technologies 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 Metalurgica Gerdau with a short position of Dell Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metalurgica Gerdau and Dell Technologies.
Diversification Opportunities for Metalurgica Gerdau and Dell Technologies
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Metalurgica and Dell is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Metalurgica Gerdau SA and Dell Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dell Technologies and Metalurgica Gerdau 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 Metalurgica Gerdau SA are associated (or correlated) with Dell Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dell Technologies has no effect on the direction of Metalurgica Gerdau i.e., Metalurgica Gerdau and Dell Technologies go up and down completely randomly.
Pair Corralation between Metalurgica Gerdau and Dell Technologies
Assuming the 90 days trading horizon Metalurgica Gerdau is expected to generate 4.32 times less return on investment than Dell Technologies. But when comparing it to its historical volatility, Metalurgica Gerdau SA is 2.57 times less risky than Dell Technologies. It trades about 0.04 of its potential returns per unit of risk. Dell Technologies is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 57,353 in Dell Technologies on August 27, 2024 and sell it today you would earn a total of 25,703 from holding Dell Technologies or generate 44.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metalurgica Gerdau SA vs. Dell Technologies
Performance |
| Timeline |
| Metalurgica Gerdau |
| Dell Technologies |
Metalurgica Gerdau and Dell Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metalurgica Gerdau and Dell Technologies
The main advantage of trading using opposite Metalurgica Gerdau and Dell Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metalurgica Gerdau position performs unexpectedly, Dell Technologies 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 Dell Technologies will offset losses from the drop in Dell Technologies' long position.| Metalurgica Gerdau vs. Companhia Siderrgica Nacional | Metalurgica Gerdau vs. Fras le SA | Metalurgica Gerdau vs. Clave Indices De | Metalurgica Gerdau vs. BTG Pactual Logstica |
| Dell Technologies vs. Positivo Tecnologia SA | Dell Technologies vs. Fras le SA | Dell Technologies vs. Clave Indices De | Dell Technologies vs. BTG Pactual Logstica |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |