Correlation Between Kaiser Aluminum and BLUELINX HLDGS
Can any of the company-specific risk be diversified away by investing in both Kaiser Aluminum and BLUELINX HLDGS 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 Kaiser Aluminum and BLUELINX HLDGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kaiser Aluminum and BLUELINX HLDGS DL 01, you can compare the effects of market volatilities on Kaiser Aluminum and BLUELINX HLDGS 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 Kaiser Aluminum with a short position of BLUELINX HLDGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaiser Aluminum and BLUELINX HLDGS.
Diversification Opportunities for Kaiser Aluminum and BLUELINX HLDGS
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Kaiser and BLUELINX is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Kaiser Aluminum and BLUELINX HLDGS DL 01 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BLUELINX HLDGS DL and Kaiser Aluminum 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 Kaiser Aluminum are associated (or correlated) with BLUELINX HLDGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BLUELINX HLDGS DL has no effect on the direction of Kaiser Aluminum i.e., Kaiser Aluminum and BLUELINX HLDGS go up and down completely randomly.
Pair Corralation between Kaiser Aluminum and BLUELINX HLDGS
Assuming the 90 days trading horizon Kaiser Aluminum is expected to under-perform the BLUELINX HLDGS. But the stock apears to be less risky and, when comparing its historical volatility, Kaiser Aluminum is 1.15 times less risky than BLUELINX HLDGS. The stock trades about -0.01 of its potential returns per unit of risk. The BLUELINX HLDGS DL 01 is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 10,200 in BLUELINX HLDGS DL 01 on September 18, 2024 and sell it today you would earn a total of 1,400 from holding BLUELINX HLDGS DL 01 or generate 13.73% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Kaiser Aluminum vs. BLUELINX HLDGS DL 01
Performance |
Timeline |
Kaiser Aluminum |
BLUELINX HLDGS DL |
Kaiser Aluminum and BLUELINX HLDGS Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Kaiser Aluminum and BLUELINX HLDGS
The main advantage of trading using opposite Kaiser Aluminum and BLUELINX HLDGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaiser Aluminum position performs unexpectedly, BLUELINX HLDGS 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 BLUELINX HLDGS will offset losses from the drop in BLUELINX HLDGS's long position.Kaiser Aluminum vs. Norsk Hydro ASA | Kaiser Aluminum vs. Aluminum of | Kaiser Aluminum vs. Superior Plus Corp | Kaiser Aluminum vs. SIVERS SEMICONDUCTORS AB |
BLUELINX HLDGS vs. DISTRICT METALS | BLUELINX HLDGS vs. Kaiser Aluminum | BLUELINX HLDGS vs. AOYAMA TRADING | BLUELINX HLDGS vs. Lion One Metals |
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
Commodity Directory Find actively traded commodities issued by global exchanges | |
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |