Correlation Between Lohakit Metal and MCS Steel
Can any of the company-specific risk be diversified away by investing in both Lohakit Metal and MCS Steel 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 Lohakit Metal and MCS Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lohakit Metal Public and MCS Steel Public, you can compare the effects of market volatilities on Lohakit Metal and MCS Steel 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 Lohakit Metal with a short position of MCS Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lohakit Metal and MCS Steel.
Diversification Opportunities for Lohakit Metal and MCS Steel
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Lohakit and MCS is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Lohakit Metal Public and MCS Steel Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MCS Steel Public and Lohakit Metal 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 Lohakit Metal Public are associated (or correlated) with MCS Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MCS Steel Public has no effect on the direction of Lohakit Metal i.e., Lohakit Metal and MCS Steel go up and down completely randomly.
Pair Corralation between Lohakit Metal and MCS Steel
Assuming the 90 days trading horizon Lohakit Metal Public is expected to under-perform the MCS Steel. But the stock apears to be less risky and, when comparing its historical volatility, Lohakit Metal Public is 43.27 times less risky than MCS Steel. The stock trades about -0.02 of its potential returns per unit of risk. The MCS Steel Public is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 813.00 in MCS Steel Public on August 30, 2024 and sell it today you would lose (98.00) from holding MCS Steel Public or give up 12.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lohakit Metal Public vs. MCS Steel Public
Performance |
| Timeline |
| Lohakit Metal Public |
| MCS Steel Public |
Lohakit Metal and MCS Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lohakit Metal and MCS Steel
The main advantage of trading using opposite Lohakit Metal and MCS Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lohakit Metal position performs unexpectedly, MCS Steel 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 MCS Steel will offset losses from the drop in MCS Steel's long position.| Lohakit Metal vs. MCS Steel Public | Lohakit Metal vs. Asia Plus Group | Lohakit Metal vs. Lalin Property Public | Lohakit Metal vs. Lam Soon Public |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Stocks Directory Find actively traded stocks across global markets | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |