Correlation Between Mesabi Trust and Maanshan Iron
Can any of the company-specific risk be diversified away by investing in both Mesabi Trust and Maanshan Iron 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 Mesabi Trust and Maanshan Iron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mesabi Trust and Maanshan Iron Steel, you can compare the effects of market volatilities on Mesabi Trust and Maanshan Iron 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 Mesabi Trust with a short position of Maanshan Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mesabi Trust and Maanshan Iron.
Diversification Opportunities for Mesabi Trust and Maanshan Iron
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Mesabi and Maanshan is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Mesabi Trust and Maanshan Iron Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maanshan Iron Steel and Mesabi Trust 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 Mesabi Trust are associated (or correlated) with Maanshan Iron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maanshan Iron Steel has no effect on the direction of Mesabi Trust i.e., Mesabi Trust and Maanshan Iron go up and down completely randomly.
Pair Corralation between Mesabi Trust and Maanshan Iron
Considering the 90-day investment horizon Mesabi Trust is expected to generate 0.36 times more return on investment than Maanshan Iron. However, Mesabi Trust is 2.8 times less risky than Maanshan Iron. It trades about 0.26 of its potential returns per unit of risk. Maanshan Iron Steel is currently generating about 0.02 per unit of risk. If you would invest 2,229 in Mesabi Trust on August 29, 2024 and sell it today you would earn a total of 468.00 from holding Mesabi Trust or generate 21.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mesabi Trust vs. Maanshan Iron Steel
Performance |
| Timeline |
| Mesabi Trust |
| Maanshan Iron Steel |
Mesabi Trust and Maanshan Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mesabi Trust and Maanshan Iron
The main advantage of trading using opposite Mesabi Trust and Maanshan Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mesabi Trust position performs unexpectedly, Maanshan Iron 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 Maanshan Iron will offset losses from the drop in Maanshan Iron's long position.| Mesabi Trust vs. Olympic Steel | Mesabi Trust vs. Universal Stainless Alloy | Mesabi Trust vs. POSCO Holdings | Mesabi Trust vs. Outokumpu Oyj ADR |
| Maanshan Iron vs. ArcelorMittal SA ADR | Maanshan Iron vs. Gerdau SA ADR | Maanshan Iron vs. POSCO Holdings |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |