Correlation Between 694308JU2 and Algoma Steel
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By analyzing existing cross correlation between PCG 42 01 JUN 41 and Algoma Steel Group, you can compare the effects of market volatilities on 694308JU2 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 694308JU2 with a short position of Algoma Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of 694308JU2 and Algoma Steel.
Diversification Opportunities for 694308JU2 and Algoma Steel
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between 694308JU2 and Algoma is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding PCG 42 01 JUN 41 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 694308JU2 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 PCG 42 01 JUN 41 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 694308JU2 i.e., 694308JU2 and Algoma Steel go up and down completely randomly.
Pair Corralation between 694308JU2 and Algoma Steel
Assuming the 90 days trading horizon PCG 42 01 JUN 41 is expected to generate 1.1 times more return on investment than Algoma Steel. However, 694308JU2 is 1.1 times more volatile than Algoma Steel Group. It trades about -0.11 of its potential returns per unit of risk. Algoma Steel Group is currently generating about -0.27 per unit of risk. If you would invest 8,214 in PCG 42 01 JUN 41 on September 13, 2024 and sell it today you would lose (284.00) from holding PCG 42 01 JUN 41 or give up 3.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 80.95% |
| Values | Daily Returns |
PCG 42 01 JUN 41 vs. Algoma Steel Group
Performance |
| Timeline |
| PCG 42 01 |
| Algoma Steel Group |
694308JU2 and Algoma Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 694308JU2 and Algoma Steel
The main advantage of trading using opposite 694308JU2 and Algoma Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 694308JU2 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.| 694308JU2 vs. Amgen Inc | 694308JU2 vs. Sonida Senior Living | 694308JU2 vs. Microbot Medical | 694308JU2 vs. Kinetik Holdings |
| Algoma Steel vs. Olympic Steel | Algoma Steel vs. Steel Dynamics | Algoma Steel vs. Commercial Metals | Algoma Steel vs. Nucor Corp |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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