Correlation Between ArcelorMittal and Ultra Clean
Can any of the company-specific risk be diversified away by investing in both ArcelorMittal and Ultra Clean 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 ArcelorMittal and Ultra Clean into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ArcelorMittal SA ADR and Ultra Clean Holdings, you can compare the effects of market volatilities on ArcelorMittal and Ultra Clean 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 ArcelorMittal with a short position of Ultra Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of ArcelorMittal and Ultra Clean.
Diversification Opportunities for ArcelorMittal and Ultra Clean
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ArcelorMittal and Ultra is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ArcelorMittal SA ADR and Ultra Clean Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ultra Clean Holdings and ArcelorMittal 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 ArcelorMittal SA ADR are associated (or correlated) with Ultra Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ultra Clean Holdings has no effect on the direction of ArcelorMittal i.e., ArcelorMittal and Ultra Clean go up and down completely randomly.
Pair Corralation between ArcelorMittal and Ultra Clean
Allowing for the 90-day total investment horizon ArcelorMittal SA ADR is expected to generate 0.63 times more return on investment than Ultra Clean. However, ArcelorMittal SA ADR is 1.6 times less risky than Ultra Clean. It trades about 0.25 of its potential returns per unit of risk. Ultra Clean Holdings is currently generating about 0.02 per unit of risk. If you would invest 2,313 in ArcelorMittal SA ADR on November 1, 2024 and sell it today you would earn a total of 217.50 from holding ArcelorMittal SA ADR or generate 9.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ArcelorMittal SA ADR vs. Ultra Clean Holdings
Performance |
| Timeline |
| ArcelorMittal SA ADR |
| Ultra Clean Holdings |
ArcelorMittal and Ultra Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ArcelorMittal and Ultra Clean
The main advantage of trading using opposite ArcelorMittal and Ultra Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ArcelorMittal position performs unexpectedly, Ultra Clean 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 Ultra Clean will offset losses from the drop in Ultra Clean's long position.| ArcelorMittal vs. Olympic Steel | ArcelorMittal vs. Ternium SA ADR | ArcelorMittal vs. Gerdau SA ADR | ArcelorMittal vs. POSCO Holdings |
| Ultra Clean vs. Diodes Incorporated | Ultra Clean vs. Daqo New Energy | Ultra Clean vs. Micron Technology | Ultra Clean vs. MagnaChip Semiconductor |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
Other Complementary Tools
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |