Correlation Between Steel Hawk and YX Precious

Can any of the company-specific risk be diversified away by investing in both Steel Hawk and YX Precious 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 Steel Hawk and YX Precious into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Steel Hawk Berhad and YX Precious Metals, you can compare the effects of market volatilities on Steel Hawk and YX Precious 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 Steel Hawk with a short position of YX Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of Steel Hawk and YX Precious.

Diversification Opportunities for Steel Hawk and YX Precious

-0.8

Correlation Coefficient

Steel Hawk  YX Precious

Pay attention - limited upside

The 3 months correlation between Steel and 0250 is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Steel Hawk Berhad and YX Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on YX Precious Metals and Steel Hawk 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 Steel Hawk Berhad are associated (or correlated) with YX Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of YX Precious Metals has no effect on the direction of Steel Hawk i.e., Steel Hawk and YX Precious go up and down completely randomly.

Pair Corralation between Steel Hawk and YX Precious

Assuming the 90 days trading horizon Steel Hawk Berhad is expected to generate 1.12 times more return on investment than YX Precious. However, Steel Hawk is 1.12 times more volatile than YX Precious Metals. It trades about 0.01 of its potential returns per unit of risk. YX Precious Metals is currently generating about 0.01 per unit of risk. If you would invest  46.00  in Steel Hawk Berhad on October 10, 2024 and sell it today you would earn a total of  0.00  from holding Steel Hawk Berhad or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Steel Hawk Berhad  vs.  YX Precious Metals

Steel Hawk Berhad

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Steel Hawk Berhad are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite quite conflicting basic indicators, Steel Hawk disclosed solid returns over the last few months and may actually be approaching a breakup point.

YX Precious Metals

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days YX Precious Metals has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest conflicting performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Steel Hawk and YX Precious

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

The idea behind Steel Hawk Berhad and YX Precious Metals 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.

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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 Stocks Directory module to find actively traded stocks across global markets.