Correlation Between Maanshan Iron and Stevanato Group
Can any of the company-specific risk be diversified away by investing in both Maanshan Iron and Stevanato Group 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 Maanshan Iron and Stevanato Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Maanshan Iron Steel and Stevanato Group SpA, you can compare the effects of market volatilities on Maanshan Iron and Stevanato Group 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 Maanshan Iron with a short position of Stevanato Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Maanshan Iron and Stevanato Group.
Diversification Opportunities for Maanshan Iron and Stevanato Group
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Maanshan and Stevanato is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Maanshan Iron Steel and Stevanato Group SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stevanato Group SpA and Maanshan Iron 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 Maanshan Iron Steel are associated (or correlated) with Stevanato Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stevanato Group SpA has no effect on the direction of Maanshan Iron i.e., Maanshan Iron and Stevanato Group go up and down completely randomly.
Pair Corralation between Maanshan Iron and Stevanato Group
Assuming the 90 days horizon Maanshan Iron Steel is expected to generate 1.72 times more return on investment than Stevanato Group. However, Maanshan Iron is 1.72 times more volatile than Stevanato Group SpA. It trades about 0.19 of its potential returns per unit of risk. Stevanato Group SpA is currently generating about 0.01 per unit of risk. If you would invest 18.00 in Maanshan Iron Steel on November 27, 2024 and sell it today you would earn a total of 3.00 from holding Maanshan Iron Steel or generate 16.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Maanshan Iron Steel vs. Stevanato Group SpA
Performance |
| Timeline |
| Maanshan Iron Steel |
| Stevanato Group SpA |
Maanshan Iron and Stevanato Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Maanshan Iron and Stevanato Group
The main advantage of trading using opposite Maanshan Iron and Stevanato Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Maanshan Iron position performs unexpectedly, Stevanato Group 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 Stevanato Group will offset losses from the drop in Stevanato Group's long position.| Maanshan Iron vs. Nucor Corp | Maanshan Iron vs. United States Steel | Maanshan Iron vs. Reliance Steel Aluminum | Maanshan Iron vs. ArcelorMittal SA ADR |
| Stevanato Group vs. Haemonetics | Stevanato Group vs. Merit Medical Systems | Stevanato Group vs. AngioDynamics | Stevanato Group vs. AptarGroup |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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