Correlation Between MAANSHAN IRON and Kraft Heinz
Can any of the company-specific risk be diversified away by investing in both MAANSHAN IRON and Kraft Heinz 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 MAANSHAN IRON and Kraft Heinz into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MAANSHAN IRON H and Kraft Heinz Co, you can compare the effects of market volatilities on MAANSHAN IRON and Kraft Heinz 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 MAANSHAN IRON with a short position of Kraft Heinz. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAANSHAN IRON and Kraft Heinz.
Diversification Opportunities for MAANSHAN IRON and Kraft Heinz
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MAANSHAN and Kraft is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding MAANSHAN IRON H and Kraft Heinz Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kraft Heinz and MAANSHAN IRON 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 MAANSHAN IRON H are associated (or correlated) with Kraft Heinz. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kraft Heinz has no effect on the direction of MAANSHAN IRON i.e., MAANSHAN IRON and Kraft Heinz go up and down completely randomly.
Pair Corralation between MAANSHAN IRON and Kraft Heinz
Assuming the 90 days trading horizon MAANSHAN IRON H is expected to generate 3.21 times more return on investment than Kraft Heinz. However, MAANSHAN IRON is 3.21 times more volatile than Kraft Heinz Co. It trades about 0.27 of its potential returns per unit of risk. Kraft Heinz Co is currently generating about -0.1 per unit of risk. If you would invest 16.00 in MAANSHAN IRON H on October 24, 2024 and sell it today you would earn a total of 4.00 from holding MAANSHAN IRON H or generate 25.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MAANSHAN IRON H vs. Kraft Heinz Co
Performance |
| Timeline |
| MAANSHAN IRON H |
| Kraft Heinz |
MAANSHAN IRON and Kraft Heinz Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MAANSHAN IRON and Kraft Heinz
The main advantage of trading using opposite MAANSHAN IRON and Kraft Heinz positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MAANSHAN IRON position performs unexpectedly, Kraft Heinz 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 Kraft Heinz will offset losses from the drop in Kraft Heinz's long position.| MAANSHAN IRON vs. Easy Software AG | MAANSHAN IRON vs. Globex Mining Enterprises | MAANSHAN IRON vs. STGEORGE MINING LTD | MAANSHAN IRON vs. Micron Technology |
| Kraft Heinz vs. MAANSHAN IRON H | Kraft Heinz vs. China BlueChemical | Kraft Heinz vs. Nippon Steel | Kraft Heinz vs. Khiron Life Sciences |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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