Correlation Between Stelco Holdings and Aperam PK

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

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

Diversification Opportunities for Stelco Holdings and Aperam PK

0.05

Correlation Coefficient

Stelco Holdings  Aperam PK

Significant diversification

The 3 months correlation between Stelco and Aperam is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Stelco Holdings and Aperam PK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aperam PK and Stelco 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 Stelco Holdings are associated (or correlated) with Aperam PK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aperam PK has no effect on the direction of Stelco Holdings i.e., Stelco Holdings and Aperam PK go up and down completely randomly.

Pair Corralation between Stelco Holdings and Aperam PK

If you would invest  4,941  in Stelco Holdings on September 28, 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	Insignificant
Accuracy	5.0%
Values	Daily Returns

Stelco Holdings  vs.  Aperam PK

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.

Aperam PK

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Aperam PK has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's primary indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with Stelco Holdings and Aperam PK

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

The idea behind Stelco Holdings and Aperam PK 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.