Correlation Between POSCO Holdings and Strattner Financial
Can any of the company-specific risk be diversified away by investing in both POSCO Holdings and Strattner Financial 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 POSCO Holdings and Strattner Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between POSCO Holdings and Strattner Financial Group, you can compare the effects of market volatilities on POSCO Holdings and Strattner Financial 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 POSCO Holdings with a short position of Strattner Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of POSCO Holdings and Strattner Financial.
Diversification Opportunities for POSCO Holdings and Strattner Financial
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between POSCO and Strattner is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding POSCO Holdings and Strattner Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strattner Financial and POSCO Holdings 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 POSCO Holdings are associated (or correlated) with Strattner Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strattner Financial has no effect on the direction of POSCO Holdings i.e., POSCO Holdings and Strattner Financial go up and down completely randomly.
Pair Corralation between POSCO Holdings and Strattner Financial
Considering the 90-day investment horizon POSCO Holdings is expected to under-perform the Strattner Financial. But the stock apears to be less risky and, when comparing its historical volatility, POSCO Holdings is 19.43 times less risky than Strattner Financial. The stock trades about -0.06 of its potential returns per unit of risk. The Strattner Financial Group is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 0.03 in Strattner Financial Group on September 12, 2024 and sell it today you would lose (0.01) from holding Strattner Financial Group or give up 33.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.72% |
| Values | Daily Returns |
POSCO Holdings vs. Strattner Financial Group
Performance |
| Timeline |
| POSCO Holdings |
| Strattner Financial |
POSCO Holdings and Strattner Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with POSCO Holdings and Strattner Financial
The main advantage of trading using opposite POSCO Holdings and Strattner Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if POSCO Holdings position performs unexpectedly, Strattner Financial 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 Strattner Financial will offset losses from the drop in Strattner Financial's long position.| POSCO Holdings vs. Olympic Steel | POSCO Holdings vs. Universal Stainless Alloy | POSCO Holdings vs. Outokumpu Oyj ADR | POSCO Holdings vs. Ternium SA ADR |
| Strattner Financial vs. POSCO Holdings | Strattner Financial vs. Schweizerische Nationalbank | Strattner Financial vs. Berkshire Hathaway | Strattner Financial vs. Berkshire Hathaway |
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.
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