Correlation Between POSCO Holdings and Tombstone Exploration
Can any of the company-specific risk be diversified away by investing in both POSCO Holdings and Tombstone Exploration 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 Tombstone Exploration into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between POSCO Holdings and Tombstone Exploration Corp, you can compare the effects of market volatilities on POSCO Holdings and Tombstone Exploration 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 Tombstone Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of POSCO Holdings and Tombstone Exploration.
Diversification Opportunities for POSCO Holdings and Tombstone Exploration
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between POSCO and Tombstone is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding POSCO Holdings and Tombstone Exploration Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tombstone Exploration 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 Tombstone Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tombstone Exploration has no effect on the direction of POSCO Holdings i.e., POSCO Holdings and Tombstone Exploration go up and down completely randomly.
Pair Corralation between POSCO Holdings and Tombstone Exploration
Considering the 90-day investment horizon POSCO Holdings is expected to generate 0.12 times more return on investment than Tombstone Exploration. However, POSCO Holdings is 8.47 times less risky than Tombstone Exploration. It trades about -0.13 of its potential returns per unit of risk. Tombstone Exploration Corp is currently generating about -0.35 per unit of risk. If you would invest 5,158 in POSCO Holdings on September 14, 2024 and sell it today you would lose (390.00) from holding POSCO Holdings or give up 7.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
POSCO Holdings vs. Tombstone Exploration Corp
Performance |
| Timeline |
| POSCO Holdings |
| Tombstone Exploration |
POSCO Holdings and Tombstone Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with POSCO Holdings and Tombstone Exploration
The main advantage of trading using opposite POSCO Holdings and Tombstone Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if POSCO Holdings position performs unexpectedly, Tombstone Exploration 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 Tombstone Exploration will offset losses from the drop in Tombstone Exploration'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 |
| Tombstone Exploration vs. Summa Silver Corp | Tombstone Exploration vs. GoGold Resources | Tombstone Exploration vs. Scottie Resources Corp | Tombstone Exploration vs. Brixton Metals |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |