Correlation Between Huadi International and Cleveland Cliffs
Can any of the company-specific risk be diversified away by investing in both Huadi International and Cleveland Cliffs 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 Huadi International and Cleveland Cliffs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Huadi International Group and Cleveland Cliffs, you can compare the effects of market volatilities on Huadi International and Cleveland Cliffs 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 Huadi International with a short position of Cleveland Cliffs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huadi International and Cleveland Cliffs.
Diversification Opportunities for Huadi International and Cleveland Cliffs
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Huadi and Cleveland is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Huadi International Group and Cleveland Cliffs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cleveland Cliffs and Huadi International 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 Huadi International Group are associated (or correlated) with Cleveland Cliffs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cleveland Cliffs has no effect on the direction of Huadi International i.e., Huadi International and Cleveland Cliffs go up and down completely randomly.
Pair Corralation between Huadi International and Cleveland Cliffs
Given the investment horizon of 90 days Huadi International Group is expected to generate 6.43 times more return on investment than Cleveland Cliffs. However, Huadi International is 6.43 times more volatile than Cleveland Cliffs. It trades about 0.02 of its potential returns per unit of risk. Cleveland Cliffs is currently generating about 0.0 per unit of risk. If you would invest 564.00 in Huadi International Group on September 2, 2024 and sell it today you would lose (364.00) from holding Huadi International Group or give up 64.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Huadi International Group vs. Cleveland Cliffs
Performance |
| Timeline |
| Huadi International |
| Cleveland Cliffs |
Huadi International and Cleveland Cliffs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huadi International and Cleveland Cliffs
The main advantage of trading using opposite Huadi International and Cleveland Cliffs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huadi International position performs unexpectedly, Cleveland Cliffs 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 Cleveland Cliffs will offset losses from the drop in Cleveland Cliffs' long position.| Huadi International vs. Olympic Steel | Huadi International vs. Steel Dynamics | Huadi International vs. Commercial Metals | Huadi International vs. Nucor Corp |
| Cleveland Cliffs vs. Nucor Corp | Cleveland Cliffs vs. Steel Dynamics | Cleveland Cliffs vs. ArcelorMittal SA ADR | Cleveland Cliffs vs. Gerdau SA ADR |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |