Correlation Between Aker Carbon and Zurn Elkay
Can any of the company-specific risk be diversified away by investing in both Aker Carbon and Zurn Elkay 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 Aker Carbon and Zurn Elkay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aker Carbon Capture and Zurn Elkay Water, you can compare the effects of market volatilities on Aker Carbon and Zurn Elkay 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 Aker Carbon with a short position of Zurn Elkay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aker Carbon and Zurn Elkay.
Diversification Opportunities for Aker Carbon and Zurn Elkay
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Aker and Zurn is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Aker Carbon Capture and Zurn Elkay Water in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zurn Elkay Water and Aker Carbon 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 Aker Carbon Capture are associated (or correlated) with Zurn Elkay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zurn Elkay Water has no effect on the direction of Aker Carbon i.e., Aker Carbon and Zurn Elkay go up and down completely randomly.
Pair Corralation between Aker Carbon and Zurn Elkay
Assuming the 90 days horizon Aker Carbon Capture is expected to generate 3.12 times more return on investment than Zurn Elkay. However, Aker Carbon is 3.12 times more volatile than Zurn Elkay Water. It trades about 0.22 of its potential returns per unit of risk. Zurn Elkay Water is currently generating about -0.26 per unit of risk. If you would invest 54.00 in Aker Carbon Capture on November 18, 2024 and sell it today you would earn a total of 11.00 from holding Aker Carbon Capture or generate 20.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Aker Carbon Capture vs. Zurn Elkay Water
Performance |
| Timeline |
| Aker Carbon Capture |
| Zurn Elkay Water |
Aker Carbon and Zurn Elkay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aker Carbon and Zurn Elkay
The main advantage of trading using opposite Aker Carbon and Zurn Elkay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aker Carbon position performs unexpectedly, Zurn Elkay 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 Zurn Elkay will offset losses from the drop in Zurn Elkay's long position.| Aker Carbon vs. CO2 Solutions | Aker Carbon vs. LifeQuest World | Aker Carbon vs. TOMI Environmental Solutions | Aker Carbon vs. Zurn Elkay Water |
| Zurn Elkay vs. Energy Recovery | Zurn Elkay vs. CECO Environmental Corp | Zurn Elkay vs. 374Water Common Stock | Zurn Elkay vs. Federal Signal |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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