Correlation Between Repligen and Maanshan Iron
Can any of the company-specific risk be diversified away by investing in both Repligen 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 Repligen and Maanshan Iron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Repligen and Maanshan Iron Steel, you can compare the effects of market volatilities on Repligen 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 Repligen with a short position of Maanshan Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Repligen and Maanshan Iron.
Diversification Opportunities for Repligen and Maanshan Iron
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Repligen and Maanshan is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Repligen 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 Repligen 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 Repligen 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 Repligen i.e., Repligen and Maanshan Iron go up and down completely randomly.
Pair Corralation between Repligen and Maanshan Iron
Given the investment horizon of 90 days Repligen is expected to generate 0.98 times more return on investment than Maanshan Iron. However, Repligen is 1.02 times less risky than Maanshan Iron. It trades about 0.11 of its potential returns per unit of risk. Maanshan Iron Steel is currently generating about -0.21 per unit of risk. If you would invest 13,721 in Repligen on August 29, 2024 and sell it today you would earn a total of 1,138 from holding Repligen or generate 8.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Repligen vs. Maanshan Iron Steel
Performance |
| Timeline |
| Repligen |
| Maanshan Iron Steel |
Repligen and Maanshan Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Repligen and Maanshan Iron
The main advantage of trading using opposite Repligen and Maanshan Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Repligen 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.| Repligen vs. Intuitive Surgical | Repligen vs. ResMed Inc | Repligen vs. Merit Medical Systems | Repligen vs. ICU Medical |
| Maanshan Iron vs. ArcelorMittal SA ADR | Maanshan Iron vs. Gerdau SA ADR | Maanshan Iron 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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