Correlation Between Insteel Industries and MAGNUM MINING
Can any of the company-specific risk be diversified away by investing in both Insteel Industries and MAGNUM 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 Insteel Industries and MAGNUM MINING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Insteel Industries and MAGNUM MINING EXP, you can compare the effects of market volatilities on Insteel Industries and MAGNUM 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 Insteel Industries with a short position of MAGNUM MINING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Insteel Industries and MAGNUM MINING.
Diversification Opportunities for Insteel Industries and MAGNUM MINING
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Insteel and MAGNUM is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Insteel Industries and MAGNUM MINING EXP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAGNUM MINING EXP and Insteel 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 Insteel Industries are associated (or correlated) with MAGNUM MINING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAGNUM MINING EXP has no effect on the direction of Insteel Industries i.e., Insteel Industries and MAGNUM MINING go up and down completely randomly.
Pair Corralation between Insteel Industries and MAGNUM MINING
If you would invest 2,520 in Insteel Industries on August 31, 2024 and sell it today you would earn a total of 340.00 from holding Insteel Industries or generate 13.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Insteel Industries vs. MAGNUM MINING EXP
Performance |
| Timeline |
| Insteel Industries |
| MAGNUM MINING EXP |
Insteel Industries and MAGNUM MINING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Insteel Industries and MAGNUM MINING
The main advantage of trading using opposite Insteel Industries and MAGNUM MINING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Insteel Industries position performs unexpectedly, MAGNUM 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 MAGNUM MINING will offset losses from the drop in MAGNUM MINING's long position.| Insteel Industries vs. American Eagle Outfitters | Insteel Industries vs. PARKEN Sport Entertainment | Insteel Industries vs. Dairy Farm International | Insteel Industries vs. AM EAGLE OUTFITTERS |
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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