Correlation Between Xiwang Special and Nucor

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

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

Diversification Opportunities for Xiwang Special and Nucor

0.0

Correlation Coefficient

Xiwang Special  Nucor

Pay attention - limited upside

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

Pair Corralation between Xiwang Special and Nucor

If you would invest  0.01  in Xiwang Special Steel on October 9, 2024 and sell it today you would earn a total of  0.00  from holding Xiwang Special Steel or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	94.12%
Values	Daily Returns

Xiwang Special Steel  vs.  Nucor

Xiwang Special Steel

Risk-Adjusted Performance

0 of 100

Very Weak

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

Nucor

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Nucor has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Xiwang Special and Nucor

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

The idea behind Xiwang Special Steel and Nucor 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.