Correlation Between BlueScope Steel and Willamette Valley

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

By analyzing existing cross correlation between BlueScope Steel Limited and Willamette Valley Vineyards, you can compare the effects of market volatilities on BlueScope Steel and Willamette Valley 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 BlueScope Steel with a short position of Willamette Valley. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlueScope Steel and Willamette Valley.

Diversification Opportunities for BlueScope Steel and Willamette Valley

-0.47

Correlation Coefficient

BlueScope Steel  Willamette Valley

Very good diversification

The 3 months correlation between BlueScope and Willamette is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding BlueScope Steel Limited and Willamette Valley Vineyards in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Willamette Valley and BlueScope Steel 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 BlueScope Steel Limited are associated (or correlated) with Willamette Valley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Willamette Valley has no effect on the direction of BlueScope Steel i.e., BlueScope Steel and Willamette Valley go up and down completely randomly.

Pair Corralation between BlueScope Steel and Willamette Valley

Assuming the 90 days horizon BlueScope Steel Limited is expected to generate 0.29 times more return on investment than Willamette Valley. However, BlueScope Steel Limited is 3.44 times less risky than Willamette Valley. It trades about 0.19 of its potential returns per unit of risk. Willamette Valley Vineyards is currently generating about 0.0 per unit of risk. If you would invest  1,450  in BlueScope Steel Limited on May 2, 2025 and sell it today you would earn a total of  57.00  from holding BlueScope Steel Limited or generate 3.93% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	44.26%
Values	Daily Returns

BlueScope Steel Limited  vs.  Willamette Valley Vineyards

BlueScope Steel

Risk-Adjusted Performance

Good

Over the last 90 days BlueScope Steel Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly unsteady technical and fundamental indicators, BlueScope Steel may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Willamette Valley

Risk-Adjusted Performance

Very Weak

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

Pair Trading with BlueScope Steel and Willamette Valley

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

The idea behind BlueScope Steel Limited and Willamette Valley Vineyards 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.