Correlation Between Cleantech Power and Maanshan Iron
Can any of the company-specific risk be diversified away by investing in both Cleantech Power 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 Cleantech Power and Maanshan Iron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cleantech Power Corp and Maanshan Iron Steel, you can compare the effects of market volatilities on Cleantech Power 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 Cleantech Power with a short position of Maanshan Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cleantech Power and Maanshan Iron.
Diversification Opportunities for Cleantech Power and Maanshan Iron
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Cleantech and Maanshan is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cleantech Power Corp 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 Cleantech Power 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 Cleantech Power Corp 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 Cleantech Power i.e., Cleantech Power and Maanshan Iron go up and down completely randomly.
Pair Corralation between Cleantech Power and Maanshan Iron
If you would invest 15.00 in Maanshan Iron Steel on September 3, 2024 and sell it today you would lose (3.00) from holding Maanshan Iron Steel or give up 20.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cleantech Power Corp vs. Maanshan Iron Steel
Performance |
| Timeline |
| Cleantech Power Corp |
| Maanshan Iron Steel |
Cleantech Power and Maanshan Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cleantech Power and Maanshan Iron
The main advantage of trading using opposite Cleantech Power and Maanshan Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cleantech Power 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.| Cleantech Power vs. Bluerock Homes Trust | Cleantech Power vs. Summit Hotel Properties | Cleantech Power vs. Altria Group | Cleantech Power vs. Stepstone Group |
| Maanshan Iron vs. Ta Chen Stainless | Maanshan Iron vs. Gerdau SA | Maanshan Iron vs. Gerdau SA | Maanshan Iron vs. Nucor Corp |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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