Correlation Between SERI INDUSTRIAL and Tenaris SA
Can any of the company-specific risk be diversified away by investing in both SERI INDUSTRIAL and Tenaris SA 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 SERI INDUSTRIAL and Tenaris SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SERI INDUSTRIAL EO and Tenaris SA, you can compare the effects of market volatilities on SERI INDUSTRIAL and Tenaris SA 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 SERI INDUSTRIAL with a short position of Tenaris SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of SERI INDUSTRIAL and Tenaris SA.
Diversification Opportunities for SERI INDUSTRIAL and Tenaris SA
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SERI and Tenaris is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding SERI INDUSTRIAL EO and Tenaris SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tenaris SA and SERI INDUSTRIAL 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 SERI INDUSTRIAL EO are associated (or correlated) with Tenaris SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tenaris SA has no effect on the direction of SERI INDUSTRIAL i.e., SERI INDUSTRIAL and Tenaris SA go up and down completely randomly.
Pair Corralation between SERI INDUSTRIAL and Tenaris SA
Assuming the 90 days trading horizon SERI INDUSTRIAL EO is expected to under-perform the Tenaris SA. In addition to that, SERI INDUSTRIAL is 2.28 times more volatile than Tenaris SA. It trades about 0.0 of its total potential returns per unit of risk. Tenaris SA is currently generating about 0.04 per unit of volatility. If you would invest 2,977 in Tenaris SA on December 3, 2024 and sell it today you would earn a total of 643.00 from holding Tenaris SA or generate 21.6% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
SERI INDUSTRIAL EO vs. Tenaris SA
Performance |
Timeline |
SERI INDUSTRIAL EO |
Tenaris SA |
SERI INDUSTRIAL and Tenaris SA Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with SERI INDUSTRIAL and Tenaris SA
The main advantage of trading using opposite SERI INDUSTRIAL and Tenaris SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SERI INDUSTRIAL position performs unexpectedly, Tenaris SA 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 Tenaris SA will offset losses from the drop in Tenaris SA's long position.SERI INDUSTRIAL vs. Eskay Mining Corp | SERI INDUSTRIAL vs. ADRIATIC METALS LS 013355 | SERI INDUSTRIAL vs. East Africa Metals | SERI INDUSTRIAL vs. Ross Stores |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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