Correlation Between MAANSHAN IRON and Pembina Pipeline
Can any of the company-specific risk be diversified away by investing in both MAANSHAN IRON and Pembina Pipeline 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 Pembina Pipeline 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 Pembina Pipeline Corp, you can compare the effects of market volatilities on MAANSHAN IRON and Pembina Pipeline 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 Pembina Pipeline. Check out your portfolio center. Please also check ongoing floating volatility patterns of MAANSHAN IRON and Pembina Pipeline.
Diversification Opportunities for MAANSHAN IRON and Pembina Pipeline
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MAANSHAN and Pembina is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding MAANSHAN IRON H and Pembina Pipeline Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pembina Pipeline Corp 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 Pembina Pipeline. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pembina Pipeline Corp has no effect on the direction of MAANSHAN IRON i.e., MAANSHAN IRON and Pembina Pipeline go up and down completely randomly.
Pair Corralation between MAANSHAN IRON and Pembina Pipeline
Assuming the 90 days trading horizon MAANSHAN IRON H is expected to generate 3.83 times more return on investment than Pembina Pipeline. However, MAANSHAN IRON is 3.83 times more volatile than Pembina Pipeline Corp. It trades about 0.24 of its potential returns per unit of risk. Pembina Pipeline Corp is currently generating about -0.24 per unit of risk. If you would invest 14.00 in MAANSHAN IRON H on October 26, 2024 and sell it today you would earn a total of 7.00 from holding MAANSHAN IRON H or generate 50.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MAANSHAN IRON H vs. Pembina Pipeline Corp
Performance |
| Timeline |
| MAANSHAN IRON H |
| Pembina Pipeline Corp |
MAANSHAN IRON and Pembina Pipeline Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MAANSHAN IRON and Pembina Pipeline
The main advantage of trading using opposite MAANSHAN IRON and Pembina Pipeline positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MAANSHAN IRON position performs unexpectedly, Pembina Pipeline 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 Pembina Pipeline will offset losses from the drop in Pembina Pipeline's long position.| MAANSHAN IRON vs. RCS MediaGroup SpA | MAANSHAN IRON vs. Nexstar Media Group | MAANSHAN IRON vs. MagnaChip Semiconductor Corp | MAANSHAN IRON vs. Nordic Semiconductor ASA |
| Pembina Pipeline vs. COMBA TELECOM SYST | Pembina Pipeline vs. Ribbon Communications | Pembina Pipeline vs. MAANSHAN IRON H | Pembina Pipeline vs. SK TELECOM TDADR |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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