Correlation Between AST SpaceMobile and Stelco Holdings

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

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

Diversification Opportunities for AST SpaceMobile and Stelco Holdings

0.73

Correlation Coefficient

AST SpaceMobile  Stelco Holdings

Poor diversification

The 3 months correlation between AST and Stelco is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding AST SpaceMobile and Stelco Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stelco Holdings and AST SpaceMobile 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 AST SpaceMobile are associated (or correlated) with Stelco Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stelco Holdings has no effect on the direction of AST SpaceMobile i.e., AST SpaceMobile and Stelco Holdings go up and down completely randomly.

Pair Corralation between AST SpaceMobile and Stelco Holdings

If you would invest  4,941  in Stelco Holdings on September 29, 2024 and sell it today you would earn a total of  0.00  from holding Stelco Holdings or generate 0.0% return on investment over 90 days.

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

AST SpaceMobile  vs.  Stelco Holdings

AST SpaceMobile

Risk-Adjusted Performance

0 of 100

Very Weak

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

Stelco Holdings

Risk-Adjusted Performance

0 of 100

Weak

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

Pair Trading with AST SpaceMobile and Stelco Holdings

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

The idea behind AST SpaceMobile and Stelco Holdings 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.