Correlation Between Adient PLC and LEGGETT
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By analyzing existing cross correlation between Adient PLC and LEGGETT PLATT INC, you can compare the effects of market volatilities on Adient PLC and LEGGETT 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 Adient PLC with a short position of LEGGETT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Adient PLC and LEGGETT.
Diversification Opportunities for Adient PLC and LEGGETT
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Adient and LEGGETT is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Adient PLC and LEGGETT PLATT INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LEGGETT PLATT INC and Adient PLC 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 Adient PLC are associated (or correlated) with LEGGETT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LEGGETT PLATT INC has no effect on the direction of Adient PLC i.e., Adient PLC and LEGGETT go up and down completely randomly.
Pair Corralation between Adient PLC and LEGGETT
Given the investment horizon of 90 days Adient PLC is expected to under-perform the LEGGETT. In addition to that, Adient PLC is 3.07 times more volatile than LEGGETT PLATT INC. It trades about -0.1 of its total potential returns per unit of risk. LEGGETT PLATT INC is currently generating about 0.02 per unit of volatility. If you would invest 9,200 in LEGGETT PLATT INC on September 3, 2024 and sell it today you would earn a total of 211.00 from holding LEGGETT PLATT INC or generate 2.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.63% |
| Values | Daily Returns |
Adient PLC vs. LEGGETT PLATT INC
Performance |
| Timeline |
| Adient PLC |
| LEGGETT PLATT INC |
Adient PLC and LEGGETT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Adient PLC and LEGGETT
The main advantage of trading using opposite Adient PLC and LEGGETT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Adient PLC position performs unexpectedly, LEGGETT 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 LEGGETT will offset losses from the drop in LEGGETT's long position.| Adient PLC vs. Allison Transmission Holdings | Adient PLC vs. Aptiv PLC | Adient PLC vs. LKQ Corporation | Adient PLC vs. Lear Corporation |
| LEGGETT vs. Maanshan Iron Steel | LEGGETT vs. Parker Hannifin | LEGGETT vs. GMS Inc | LEGGETT vs. Apogee Enterprises |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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