Correlation Between United States and Ferrexpo PLC
Can any of the company-specific risk be diversified away by investing in both United States and Ferrexpo PLC 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 Ferrexpo PLC 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 Ferrexpo PLC, you can compare the effects of market volatilities on United States and Ferrexpo PLC 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 Ferrexpo PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of United States and Ferrexpo PLC.
Diversification Opportunities for United States and Ferrexpo PLC
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between United and Ferrexpo is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding United States Steel and Ferrexpo PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ferrexpo PLC 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 Ferrexpo PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ferrexpo PLC has no effect on the direction of United States i.e., United States and Ferrexpo PLC go up and down completely randomly.
Pair Corralation between United States and Ferrexpo PLC
Taking into account the 90-day investment horizon United States Steel is expected to generate 0.72 times more return on investment than Ferrexpo PLC. However, United States Steel is 1.39 times less risky than Ferrexpo PLC. It trades about 0.05 of its potential returns per unit of risk. Ferrexpo PLC is currently generating about -0.01 per unit of risk. If you would invest 2,549 in United States Steel on September 2, 2024 and sell it today you would earn a total of 1,528 from holding United States Steel or generate 59.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
United States Steel vs. Ferrexpo PLC
Performance |
| Timeline |
| United States Steel |
| Ferrexpo PLC |
United States and Ferrexpo PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United States and Ferrexpo PLC
The main advantage of trading using opposite United States and Ferrexpo PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United States position performs unexpectedly, Ferrexpo PLC 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 Ferrexpo PLC will offset losses from the drop in Ferrexpo PLC's long position.| United States vs. Fortitude Gold Corp | United States vs. New Gold | United States vs. Galiano Gold | United States vs. GoldMining |
| Ferrexpo PLC vs. ArcelorMittal SA | Ferrexpo PLC vs. Acerinox SA ADR | Ferrexpo PLC vs. Aperam PK | Ferrexpo PLC vs. Algoma Steel Group |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |