Correlation Between Postal Savings and BLUESCOPE STEEL
Can any of the company-specific risk be diversified away by investing in both Postal Savings and BLUESCOPE STEEL 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 Postal Savings and BLUESCOPE STEEL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Postal Savings Bank and BLUESCOPE STEEL, you can compare the effects of market volatilities on Postal Savings and BLUESCOPE STEEL 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 Postal Savings with a short position of BLUESCOPE STEEL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Postal Savings and BLUESCOPE STEEL.
Diversification Opportunities for Postal Savings and BLUESCOPE STEEL
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Postal and BLUESCOPE is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Postal Savings Bank and BLUESCOPE STEEL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BLUESCOPE STEEL and Postal Savings 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 Postal Savings Bank are associated (or correlated) with BLUESCOPE STEEL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BLUESCOPE STEEL has no effect on the direction of Postal Savings i.e., Postal Savings and BLUESCOPE STEEL go up and down completely randomly.
Pair Corralation between Postal Savings and BLUESCOPE STEEL
Assuming the 90 days horizon Postal Savings Bank is expected to generate 0.5 times more return on investment than BLUESCOPE STEEL. However, Postal Savings Bank is 2.01 times less risky than BLUESCOPE STEEL. It trades about 0.08 of its potential returns per unit of risk. BLUESCOPE STEEL is currently generating about -0.24 per unit of risk. If you would invest 54.00 in Postal Savings Bank on September 25, 2024 and sell it today you would earn a total of 1.00 from holding Postal Savings Bank or generate 1.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Postal Savings Bank vs. BLUESCOPE STEEL
Performance |
Timeline |
Postal Savings Bank |
BLUESCOPE STEEL |
Postal Savings and BLUESCOPE STEEL Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Postal Savings and BLUESCOPE STEEL
The main advantage of trading using opposite Postal Savings and BLUESCOPE STEEL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Postal Savings position performs unexpectedly, BLUESCOPE STEEL 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 BLUESCOPE STEEL will offset losses from the drop in BLUESCOPE STEEL's long position.Postal Savings vs. POSBO UNSPADRS20YC1 | Postal Savings vs. Truist Financial | Postal Savings vs. OVERSEA CHINUNSPADR2 | Postal Savings vs. Oversea Chinese Banking |
BLUESCOPE STEEL vs. Apple Inc | BLUESCOPE STEEL vs. Apple Inc | BLUESCOPE STEEL vs. Apple Inc | BLUESCOPE STEEL vs. Apple Inc |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
Share Portfolio Track or share privately all of your investments from the convenience of any device | |
Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
Fundamental Analysis View fundamental data based on most recent published financial statements | |
Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
Insider Screener Find insiders across different sectors to evaluate their impact on performance |