Correlation Between United States and Hamat
Can any of the company-specific risk be diversified away by investing in both United States and Hamat 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 Hamat 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 Hamat Group, you can compare the effects of market volatilities on United States and Hamat 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 Hamat. Check out your portfolio center. Please also check ongoing floating volatility patterns of United States and Hamat.
Diversification Opportunities for United States and Hamat
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between United and Hamat is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding United States Steel and Hamat Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hamat Group 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 Hamat. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hamat Group has no effect on the direction of United States i.e., United States and Hamat go up and down completely randomly.
Pair Corralation between United States and Hamat
Taking into account the 90-day investment horizon United States Steel is expected to generate 0.53 times more return on investment than Hamat. However, United States Steel is 1.9 times less risky than Hamat. It trades about -0.05 of its potential returns per unit of risk. Hamat Group is currently generating about -0.1 per unit of risk. If you would invest 3,969 in United States Steel on January 20, 2024 and sell it today you would lose (75.00) from holding United States Steel or give up 1.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 90.48% |
| Values | Daily Returns |
United States Steel vs. Hamat Group
Performance |
| Timeline |
| United States Steel |
| Hamat Group |
United States and Hamat Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United States and Hamat
The main advantage of trading using opposite United States and Hamat positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United States position performs unexpectedly, Hamat 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 Hamat will offset losses from the drop in Hamat's long position.| United States vs. Nucor Corp | United States vs. Steel Dynamics | United States vs. ArcelorMittal SA ADR | United States vs. Gerdau SA ADR |
| Hamat vs. EN Shoham Business | Hamat vs. Accel Solutions Group | Hamat vs. Mivtach Shamir | Hamat vs. Rani Zim Shopping |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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