Correlation Between POSCO Holdings and Guerrilla
Can any of the company-specific risk be diversified away by investing in both POSCO Holdings and Guerrilla 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 POSCO Holdings and Guerrilla into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between POSCO Holdings and Guerrilla RF, you can compare the effects of market volatilities on POSCO Holdings and Guerrilla 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 POSCO Holdings with a short position of Guerrilla. Check out your portfolio center. Please also check ongoing floating volatility patterns of POSCO Holdings and Guerrilla.
Diversification Opportunities for POSCO Holdings and Guerrilla
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between POSCO and Guerrilla is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding POSCO Holdings and Guerrilla RF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guerrilla RF and POSCO Holdings 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 POSCO Holdings are associated (or correlated) with Guerrilla. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guerrilla RF has no effect on the direction of POSCO Holdings i.e., POSCO Holdings and Guerrilla go up and down completely randomly.
Pair Corralation between POSCO Holdings and Guerrilla
Considering the 90-day investment horizon POSCO Holdings is expected to under-perform the Guerrilla. But the stock apears to be less risky and, when comparing its historical volatility, POSCO Holdings is 6.54 times less risky than Guerrilla. The stock trades about -0.33 of its potential returns per unit of risk. The Guerrilla RF is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 116.00 in Guerrilla RF on October 4, 2024 and sell it today you would earn a total of 22.00 from holding Guerrilla RF or generate 18.97% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
POSCO Holdings vs. Guerrilla RF
Performance |
Timeline |
POSCO Holdings |
Guerrilla RF |
POSCO Holdings and Guerrilla Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with POSCO Holdings and Guerrilla
The main advantage of trading using opposite POSCO Holdings and Guerrilla positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if POSCO Holdings position performs unexpectedly, Guerrilla 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 Guerrilla will offset losses from the drop in Guerrilla's long position.POSCO Holdings vs. Usinas Siderurgicas de | POSCO Holdings vs. Ternium SA ADR | POSCO Holdings vs. ArcelorMittal SA ADR | POSCO Holdings vs. Steel Dynamics |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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