Correlation Between Public Joint and Aperam SA

Can any of the company-specific risk be diversified away by investing in both Public Joint and Aperam SA 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 Public Joint and Aperam SA into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Public Joint Stock and Aperam SA, you can compare the effects of market volatilities on Public Joint and Aperam SA 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 Public Joint with a short position of Aperam SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Public Joint and Aperam SA.

Diversification Opportunities for Public Joint and Aperam SA

0.0

Correlation Coefficient

Public Joint  Aperam SA

Pay attention - limited upside

The 3 months correlation between Public and Aperam is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Public Joint Stock and Aperam SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aperam SA and Public Joint 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 Public Joint Stock are associated (or correlated) with Aperam SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aperam SA has no effect on the direction of Public Joint i.e., Public Joint and Aperam SA go up and down completely randomly.

Pair Corralation between Public Joint and Aperam SA

If you would invest  2,561  in Aperam SA on January 25, 2024 and sell it today you would earn a total of  488.00  from holding Aperam SA or generate 19.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	19.84%
Values	Daily Returns

Public Joint Stock  vs.  Aperam SA

Public Joint Stock

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Public Joint Stock has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Public Joint is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Aperam SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aperam SA has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Aperam SA is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Public Joint and Aperam SA

The main advantage of trading using opposite Public Joint and Aperam SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Public Joint position performs unexpectedly, Aperam SA 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 Aperam SA will offset losses from the drop in Aperam SA's long position.

The idea behind Public Joint Stock and Aperam SA 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.

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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.