Correlation Between United States and AK Steel
Can any of the company-specific risk be diversified away by investing in both United States and AK Steel 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 United States and AK Steel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United States Steel and AK Steel Holding, you can compare the effects of market volatilities on United States and AK Steel 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 United States with a short position of AK Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of United States and AK Steel.
Diversification Opportunities for United States and AK Steel
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between United and AKS is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding United States Steel and AK Steel Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AK Steel Holding and United States 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 United States Steel are associated (or correlated) with AK Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AK Steel Holding has no effect on the direction of United States i.e., United States and AK Steel go up and down completely randomly.
Pair Corralation between United States and AK Steel
If you would invest (100.00) in AK Steel Holding on December 29, 2023 and sell it today you would earn a total of 100.00 from holding AK Steel Holding 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 |
United States Steel vs. AK Steel Holding
Performance |
Timeline |
United States Steel |
AK Steel Holding |
Risk-Adjusted Performance
0 of 100
Low | High |
Very Weak
United States and AK Steel Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with United States and AK Steel
The main advantage of trading using opposite United States and AK Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United States position performs unexpectedly, AK Steel 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 AK Steel will offset losses from the drop in AK Steel's long position.United States vs. Chemours Co | United States vs. CF Industries Holdings | United States vs. Dupont De Nemours | United States vs. FutureFuel Corp |
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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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