Correlation Between Universal Stainless and AMERICAN

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

By analyzing existing cross correlation between Universal Stainless Alloy and AMERICAN TOWER PORATION, you can compare the effects of market volatilities on Universal Stainless and AMERICAN 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 Universal Stainless with a short position of AMERICAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Universal Stainless and AMERICAN.

Diversification Opportunities for Universal Stainless and AMERICAN

0.0

Correlation Coefficient

Universal Stainless  AMERICAN

Pay attention - limited upside

The 3 months correlation between Universal and AMERICAN is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Universal Stainless Alloy and AMERICAN TOWER PORATION in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMERICAN TOWER PORATION and Universal Stainless 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 Universal Stainless Alloy are associated (or correlated) with AMERICAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMERICAN TOWER PORATION has no effect on the direction of Universal Stainless i.e., Universal Stainless and AMERICAN go up and down completely randomly.

Pair Corralation between Universal Stainless and AMERICAN

If you would invest (100.00) in Universal Stainless Alloy on December 25, 2024 and sell it today you would earn a total of  100.00  from holding Universal Stainless Alloy or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Universal Stainless Alloy  vs.  AMERICAN TOWER PORATION

Universal Stainless Alloy

Risk-Adjusted Performance

Very Weak

Over the last 90 days Universal Stainless Alloy has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Universal Stainless is not utilizing all of its potentials. The newest stock price agitation, may contribute to short-term losses for the retail investors.

AMERICAN TOWER PORATION

Risk-Adjusted Performance

Very Weak

Over the last 90 days AMERICAN TOWER PORATION has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, AMERICAN is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Universal Stainless and AMERICAN

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

The idea behind Universal Stainless Alloy and AMERICAN TOWER PORATION 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.