Correlation Between Pintec Technology and Olympic Steel
Can any of the company-specific risk be diversified away by investing in both Pintec Technology and Olympic Steel 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 Pintec Technology and Olympic Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pintec Technology Holdings and Olympic Steel, you can compare the effects of market volatilities on Pintec Technology and Olympic Steel 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 Pintec Technology with a short position of Olympic Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pintec Technology and Olympic Steel.
Diversification Opportunities for Pintec Technology and Olympic Steel
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pintec and Olympic is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Pintec Technology Holdings and Olympic Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Olympic Steel and Pintec Technology 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 Pintec Technology Holdings are associated (or correlated) with Olympic Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Olympic Steel has no effect on the direction of Pintec Technology i.e., Pintec Technology and Olympic Steel go up and down completely randomly.
Pair Corralation between Pintec Technology and Olympic Steel
Allowing for the 90-day total investment horizon Pintec Technology Holdings is expected to under-perform the Olympic Steel. But the stock apears to be less risky and, when comparing its historical volatility, Pintec Technology Holdings is 1.21 times less risky than Olympic Steel. The stock trades about -0.02 of its potential returns per unit of risk. The Olympic Steel is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 3,638 in Olympic Steel on August 31, 2024 and sell it today you would earn a total of 593.00 from holding Olympic Steel or generate 16.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pintec Technology Holdings vs. Olympic Steel
Performance |
| Timeline |
| Pintec Technology |
| Olympic Steel |
Pintec Technology and Olympic Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pintec Technology and Olympic Steel
The main advantage of trading using opposite Pintec Technology and Olympic Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pintec Technology position performs unexpectedly, Olympic Steel 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 Olympic Steel will offset losses from the drop in Olympic Steel's long position.| Pintec Technology vs. Senmiao Technology | Pintec Technology vs. X Financial Class | Pintec Technology vs. Yirendai | Pintec Technology vs. Qudian Inc |
| Olympic Steel vs. Universal Stainless Alloy | Olympic Steel vs. Outokumpu Oyj ADR | Olympic Steel vs. Usinas Siderurgicas de | Olympic Steel 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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