Correlation Between Sanyo Special and Allegheny Technologies
Can any of the company-specific risk be diversified away by investing in both Sanyo Special and Allegheny Technologies 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 Sanyo Special and Allegheny Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sanyo Special Steel and Allegheny Technologies Incorporated, you can compare the effects of market volatilities on Sanyo Special and Allegheny Technologies 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 Sanyo Special with a short position of Allegheny Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sanyo Special and Allegheny Technologies.
Diversification Opportunities for Sanyo Special and Allegheny Technologies
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sanyo and Allegheny is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Sanyo Special Steel and Allegheny Technologies Incorpo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allegheny Technologies and Sanyo Special 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 Sanyo Special Steel are associated (or correlated) with Allegheny Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allegheny Technologies has no effect on the direction of Sanyo Special i.e., Sanyo Special and Allegheny Technologies go up and down completely randomly.
Pair Corralation between Sanyo Special and Allegheny Technologies
Assuming the 90 days horizon Sanyo Special Steel is expected to under-perform the Allegheny Technologies. But the pink sheet apears to be less risky and, when comparing its historical volatility, Sanyo Special Steel is 3.16 times less risky than Allegheny Technologies. The pink sheet trades about -0.03 of its potential returns per unit of risk. The Allegheny Technologies Incorporated is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 4,065 in Allegheny Technologies Incorporated on November 19, 2024 and sell it today you would earn a total of 2,039 from holding Allegheny Technologies Incorporated or generate 50.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Sanyo Special Steel vs. Allegheny Technologies Incorpo
Performance |
| Timeline |
| Sanyo Special Steel |
| Allegheny Technologies |
Sanyo Special and Allegheny Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sanyo Special and Allegheny Technologies
The main advantage of trading using opposite Sanyo Special and Allegheny Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sanyo Special position performs unexpectedly, Allegheny Technologies 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 Allegheny Technologies will offset losses from the drop in Allegheny Technologies' long position.| Sanyo Special vs. Legacy Education | Sanyo Special vs. Apple Inc | Sanyo Special vs. NVIDIA | Sanyo Special vs. Microsoft |
| Allegheny Technologies vs. Worthington Industries | Allegheny Technologies vs. ESAB Corp | Allegheny Technologies vs. Insteel Industries | Allegheny Technologies vs. Northwest Pipe |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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