Correlation Between Western Union and ArcelorMittal
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By analyzing existing cross correlation between Western Union Co and ArcelorMittal 455 percent, you can compare the effects of market volatilities on Western Union and ArcelorMittal 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 Western Union with a short position of ArcelorMittal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Union and ArcelorMittal.
Diversification Opportunities for Western Union and ArcelorMittal
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Western and ArcelorMittal is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Western Union Co and ArcelorMittal 455 percent in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ArcelorMittal 455 percent and Western Union 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 Western Union Co are associated (or correlated) with ArcelorMittal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ArcelorMittal 455 percent has no effect on the direction of Western Union i.e., Western Union and ArcelorMittal go up and down completely randomly.
Pair Corralation between Western Union and ArcelorMittal
Allowing for the 90-day total investment horizon Western Union Co is expected to under-perform the ArcelorMittal. In addition to that, Western Union is 1.4 times more volatile than ArcelorMittal 455 percent. It trades about -0.08 of its total potential returns per unit of risk. ArcelorMittal 455 percent is currently generating about -0.02 per unit of volatility. If you would invest 9,990 in ArcelorMittal 455 percent on September 12, 2024 and sell it today you would lose (141.00) from holding ArcelorMittal 455 percent or give up 1.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 92.19% |
| Values | Daily Returns |
Western Union Co vs. ArcelorMittal 455 percent
Performance |
| Timeline |
| Western Union |
| ArcelorMittal 455 percent |
Western Union and ArcelorMittal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Union and ArcelorMittal
The main advantage of trading using opposite Western Union and ArcelorMittal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Union position performs unexpectedly, ArcelorMittal 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 ArcelorMittal will offset losses from the drop in ArcelorMittal's long position.| Western Union vs. Navient Corp | Western Union vs. Green Dot | Western Union vs. Orix Corp Ads | Western Union vs. FirstCash |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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