Correlation Between Steelcast and Cybertech Systems

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

By analyzing existing cross correlation between Steelcast Limited and Cybertech Systems And, you can compare the effects of market volatilities on Steelcast and Cybertech Systems 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 Steelcast with a short position of Cybertech Systems. Check out your portfolio center. Please also check ongoing floating volatility patterns of Steelcast and Cybertech Systems.

Diversification Opportunities for Steelcast and Cybertech Systems

0.72

Correlation Coefficient

Steelcast  Cybertech Systems

Poor diversification

The 3 months correlation between Steelcast and Cybertech is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Steelcast Limited and Cybertech Systems And in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cybertech Systems And and Steelcast 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 Steelcast Limited are associated (or correlated) with Cybertech Systems. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cybertech Systems And has no effect on the direction of Steelcast i.e., Steelcast and Cybertech Systems go up and down completely randomly.

Pair Corralation between Steelcast and Cybertech Systems

Assuming the 90 days trading horizon Steelcast Limited is expected to generate 1.2 times more return on investment than Cybertech Systems. However, Steelcast is 1.2 times more volatile than Cybertech Systems And. It trades about 0.18 of its potential returns per unit of risk. Cybertech Systems And is currently generating about 0.14 per unit of risk. If you would invest  91,440  in Steelcast Limited on April 23, 2025 and sell it today you would earn a total of  26,920  from holding Steelcast Limited or generate 29.44% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Steelcast Limited  vs.  Cybertech Systems And

Steelcast Limited

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Steelcast Limited are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain fundamental indicators, Steelcast sustained solid returns over the last few months and may actually be approaching a breakup point.

Cybertech Systems And

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cybertech Systems And are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady technical and fundamental indicators, Cybertech Systems exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Steelcast and Cybertech Systems

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

The idea behind Steelcast Limited and Cybertech Systems And 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.