Correlation Between Cementos Argos and China Steel
Can any of the company-specific risk be diversified away by investing in both Cementos Argos and China Steel 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 Cementos Argos and China Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cementos Argos SA and China Steel, you can compare the effects of market volatilities on Cementos Argos and China Steel 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 Cementos Argos with a short position of China Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cementos Argos and China Steel.
Diversification Opportunities for Cementos Argos and China Steel
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cementos and China is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Cementos Argos SA and China Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Steel and Cementos Argos 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 Cementos Argos SA are associated (or correlated) with China Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Steel has no effect on the direction of Cementos Argos i.e., Cementos Argos and China Steel go up and down completely randomly.
Pair Corralation between Cementos Argos and China Steel
If you would invest 2,877 in China Steel on January 26, 2024 and sell it today you would earn a total of 0.00 from holding China Steel or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 4.76% |
| Values | Daily Returns |
Cementos Argos SA vs. China Steel
Performance |
| Timeline |
| Cementos Argos SA |
| China Steel |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Cementos Argos and China Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cementos Argos and China Steel
The main advantage of trading using opposite Cementos Argos and China Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cementos Argos position performs unexpectedly, China Steel 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 China Steel will offset losses from the drop in China Steel's long position.The idea behind Cementos Argos SA and China Steel pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| China Steel vs. Noble plc | China Steel vs. Hanover Foods | China Steel vs. NH Foods Ltd | China Steel vs. Natural Alternatives International |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |