Correlation Between Mayer Steel and Yeou Yih

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

By analyzing existing cross correlation between Mayer Steel Pipe and Yeou Yih Steel, you can compare the effects of market volatilities on Mayer Steel and Yeou Yih 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 Mayer Steel with a short position of Yeou Yih. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mayer Steel and Yeou Yih.

Diversification Opportunities for Mayer Steel and Yeou Yih

0.59

Correlation Coefficient

Mayer Steel  Yeou Yih

Very weak diversification

The 3 months correlation between Mayer and Yeou is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Mayer Steel Pipe and Yeou Yih Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yeou Yih Steel and Mayer Steel 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 Mayer Steel Pipe are associated (or correlated) with Yeou Yih. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yeou Yih Steel has no effect on the direction of Mayer Steel i.e., Mayer Steel and Yeou Yih go up and down completely randomly.

Pair Corralation between Mayer Steel and Yeou Yih

Assuming the 90 days trading horizon Mayer Steel Pipe is expected to generate 1.27 times more return on investment than Yeou Yih. However, Mayer Steel is 1.27 times more volatile than Yeou Yih Steel. It trades about 0.03 of its potential returns per unit of risk. Yeou Yih Steel is currently generating about 0.01 per unit of risk. If you would invest  2,355  in Mayer Steel Pipe on September 15, 2024 and sell it today you would earn a total of  460.00  from holding Mayer Steel Pipe or generate 19.53% return on investment over 90 days.

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

Mayer Steel Pipe  vs.  Yeou Yih Steel

Mayer Steel Pipe

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mayer Steel Pipe has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Mayer Steel is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Yeou Yih Steel

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Yeou Yih Steel are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Yeou Yih is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Mayer Steel and Yeou Yih

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

The idea behind Mayer Steel Pipe and Yeou Yih 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.

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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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.