Correlation Between Aecom Technology and Fluor
Can any of the company-specific risk be diversified away by investing in both Aecom Technology and Fluor 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 Aecom Technology and Fluor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aecom Technology and Fluor, you can compare the effects of market volatilities on Aecom Technology and Fluor 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 Aecom Technology with a short position of Fluor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aecom Technology and Fluor.
Diversification Opportunities for Aecom Technology and Fluor
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aecom and Fluor is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Aecom Technology and Fluor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fluor and Aecom Technology 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 Aecom Technology are associated (or correlated) with Fluor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fluor has no effect on the direction of Aecom Technology i.e., Aecom Technology and Fluor go up and down completely randomly.
Pair Corralation between Aecom Technology and Fluor
Considering the 90-day investment horizon Aecom Technology is expected to generate 1.55 times less return on investment than Fluor. But when comparing it to its historical volatility, Aecom Technology is 1.48 times less risky than Fluor. It trades about 0.11 of its potential returns per unit of risk. Fluor is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 3,680 in Fluor on August 27, 2024 and sell it today you would earn a total of 1,899 from holding Fluor or generate 51.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aecom Technology vs. Fluor
Performance |
| Timeline |
| Aecom Technology |
| Fluor |
Aecom Technology and Fluor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aecom Technology and Fluor
The main advantage of trading using opposite Aecom Technology and Fluor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aecom Technology position performs unexpectedly, Fluor 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 Fluor will offset losses from the drop in Fluor's long position.| Aecom Technology vs. Innovate Corp | Aecom Technology vs. Energy Services | Aecom Technology vs. Api Group Corp | Aecom Technology vs. Topbuild Corp |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon |