Correlation Between Stevanato Group and Maanshan Iron
Can any of the company-specific risk be diversified away by investing in both Stevanato Group 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 Stevanato Group and Maanshan Iron into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Stevanato Group SpA and Maanshan Iron Steel, you can compare the effects of market volatilities on Stevanato Group 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 Stevanato Group with a short position of Maanshan Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stevanato Group and Maanshan Iron.
Diversification Opportunities for Stevanato Group and Maanshan Iron
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Stevanato and Maanshan is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Stevanato Group SpA 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 Stevanato Group 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 Stevanato Group SpA 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 Stevanato Group i.e., Stevanato Group and Maanshan Iron go up and down completely randomly.
Pair Corralation between Stevanato Group and Maanshan Iron
Given the investment horizon of 90 days Stevanato Group SpA is expected to under-perform the Maanshan Iron. But the stock apears to be less risky and, when comparing its historical volatility, Stevanato Group SpA is 1.38 times less risky than Maanshan Iron. The stock trades about -0.02 of its potential returns per unit of risk. The Maanshan Iron Steel is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 17.00 in Maanshan Iron Steel on September 1, 2024 and sell it today you would lose (5.00) from holding Maanshan Iron Steel or give up 29.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Stevanato Group SpA vs. Maanshan Iron Steel
Performance |
| Timeline |
| Stevanato Group SpA |
| Maanshan Iron Steel |
Stevanato Group and Maanshan Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stevanato Group and Maanshan Iron
The main advantage of trading using opposite Stevanato Group and Maanshan Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stevanato Group 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.| Stevanato Group vs. Haemonetics | Stevanato Group vs. Merit Medical Systems | Stevanato Group vs. AngioDynamics | Stevanato Group vs. AptarGroup |
| Maanshan Iron vs. Olympic Steel | Maanshan Iron vs. POSCO Holdings | Maanshan Iron vs. Steel Dynamics | Maanshan Iron vs. Universal Stainless Alloy |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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