Correlation Between United States and Capex SA
Can any of the company-specific risk be diversified away by investing in both United States and Capex SA 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 United States and Capex SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United States Steel and Capex SA, you can compare the effects of market volatilities on United States and Capex SA 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 United States with a short position of Capex SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of United States and Capex SA.
Diversification Opportunities for United States and Capex SA
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between United and Capex is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding United States Steel and Capex SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Capex SA and United States 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 United States Steel are associated (or correlated) with Capex SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Capex SA has no effect on the direction of United States i.e., United States and Capex SA go up and down completely randomly.
Pair Corralation between United States and Capex SA
Given the investment horizon of 90 days United States Steel is expected to under-perform the Capex SA. In addition to that, United States is 1.61 times more volatile than Capex SA. It trades about -0.03 of its total potential returns per unit of risk. Capex SA is currently generating about 0.29 per unit of volatility. If you would invest 620,000 in Capex SA on August 26, 2024 and sell it today you would earn a total of 90,000 from holding Capex SA or generate 14.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
United States Steel vs. Capex SA
Performance |
| Timeline |
| United States Steel |
| Capex SA |
United States and Capex SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United States and Capex SA
The main advantage of trading using opposite United States and Capex SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United States position performs unexpectedly, Capex SA 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 Capex SA will offset losses from the drop in Capex SA's long position.| United States vs. Telecom Argentina | United States vs. Harmony Gold Mining | United States vs. Agrometal SAI | United States vs. Compania de Transporte |
| Capex SA vs. Transportadora de Gas | Capex SA vs. Harmony Gold Mining | Capex SA vs. Agrometal SAI | Capex SA vs. Compania de Transporte |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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