Correlation Between Steel Dynamics and Calamos Timpani
Can any of the company-specific risk be diversified away by investing in both Steel Dynamics and Calamos Timpani 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 Steel Dynamics and Calamos Timpani into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Steel Dynamics and Calamos Timpani Smid, you can compare the effects of market volatilities on Steel Dynamics and Calamos Timpani 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 Steel Dynamics with a short position of Calamos Timpani. Check out your portfolio center. Please also check ongoing floating volatility patterns of Steel Dynamics and Calamos Timpani.
Diversification Opportunities for Steel Dynamics and Calamos Timpani
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Steel and Calamos is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Steel Dynamics and Calamos Timpani Smid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Calamos Timpani Smid and Steel Dynamics 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 Steel Dynamics are associated (or correlated) with Calamos Timpani. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Calamos Timpani Smid has no effect on the direction of Steel Dynamics i.e., Steel Dynamics and Calamos Timpani go up and down completely randomly.
Pair Corralation between Steel Dynamics and Calamos Timpani
Given the investment horizon of 90 days Steel Dynamics is expected to generate 1.29 times less return on investment than Calamos Timpani. In addition to that, Steel Dynamics is 1.62 times more volatile than Calamos Timpani Smid. It trades about 0.04 of its total potential returns per unit of risk. Calamos Timpani Smid is currently generating about 0.08 per unit of volatility. If you would invest 992.00 in Calamos Timpani Smid on September 4, 2024 and sell it today you would earn a total of 671.00 from holding Calamos Timpani Smid or generate 67.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Steel Dynamics vs. Calamos Timpani Smid
Performance |
| Timeline |
| Steel Dynamics |
| Calamos Timpani Smid |
Steel Dynamics and Calamos Timpani Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Steel Dynamics and Calamos Timpani
The main advantage of trading using opposite Steel Dynamics and Calamos Timpani positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Steel Dynamics position performs unexpectedly, Calamos Timpani 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 Calamos Timpani will offset losses from the drop in Calamos Timpani's long position.| Steel Dynamics vs. Cleveland Cliffs | Steel Dynamics vs. United States Steel | Steel Dynamics vs. ArcelorMittal SA ADR | Steel Dynamics vs. Reliance Steel Aluminum |
| Calamos Timpani vs. Dreyfus Technology Growth | Calamos Timpani vs. Technology Ultrasector Profund | Calamos Timpani vs. Allianzgi Technology Fund | Calamos Timpani vs. Dreyfus Technology Growth |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |