Correlation Between 42225UAD6 and Algoma Steel
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By analyzing existing cross correlation between HEALTHCARE TR AMER and Algoma Steel Group, you can compare the effects of market volatilities on 42225UAD6 and Algoma Steel 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 42225UAD6 with a short position of Algoma Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of 42225UAD6 and Algoma Steel.
Diversification Opportunities for 42225UAD6 and Algoma Steel
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 42225UAD6 and Algoma is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding HEALTHCARE TR AMER and Algoma Steel Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Algoma Steel Group and 42225UAD6 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 HEALTHCARE TR AMER are associated (or correlated) with Algoma Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Algoma Steel Group has no effect on the direction of 42225UAD6 i.e., 42225UAD6 and Algoma Steel go up and down completely randomly.
Pair Corralation between 42225UAD6 and Algoma Steel
Assuming the 90 days trading horizon HEALTHCARE TR AMER is expected to under-perform the Algoma Steel. But the bond apears to be less risky and, when comparing its historical volatility, HEALTHCARE TR AMER is 5.67 times less risky than Algoma Steel. The bond trades about -0.24 of its potential returns per unit of risk. The Algoma Steel Group is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,030 in Algoma Steel Group on September 1, 2024 and sell it today you would earn a total of 47.00 from holding Algoma Steel Group or generate 4.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 71.43% |
| Values | Daily Returns |
HEALTHCARE TR AMER vs. Algoma Steel Group
Performance |
| Timeline |
| HEALTHCARE TR AMER |
| Algoma Steel Group |
42225UAD6 and Algoma Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 42225UAD6 and Algoma Steel
The main advantage of trading using opposite 42225UAD6 and Algoma Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 42225UAD6 position performs unexpectedly, Algoma Steel 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 Algoma Steel will offset losses from the drop in Algoma Steel's long position.| 42225UAD6 vs. Boyd Gaming | 42225UAD6 vs. Algoma Steel Group | 42225UAD6 vs. GEN Restaurant Group, | 42225UAD6 vs. Grupo Simec SAB |
| Algoma Steel vs. Friedman Industries | Algoma Steel vs. ArcelorMittal SA | Algoma Steel vs. Aperam PK | Algoma Steel vs. Acerinox SA ADR |
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 Stocks Directory module to find actively traded stocks across global markets.
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