Correlation Between Air Products and Graphene Manufacturing
Can any of the company-specific risk be diversified away by investing in both Air Products and Graphene Manufacturing 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 Air Products and Graphene Manufacturing into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Air Products and and Graphene Manufacturing Group, you can compare the effects of market volatilities on Air Products and Graphene Manufacturing 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 Air Products with a short position of Graphene Manufacturing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Air Products and Graphene Manufacturing.
Diversification Opportunities for Air Products and Graphene Manufacturing
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Air and Graphene is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Air Products and and Graphene Manufacturing Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Graphene Manufacturing and Air Products 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 Air Products and are associated (or correlated) with Graphene Manufacturing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Graphene Manufacturing has no effect on the direction of Air Products i.e., Air Products and Graphene Manufacturing go up and down completely randomly.
Pair Corralation between Air Products and Graphene Manufacturing
Considering the 90-day investment horizon Air Products and is expected to generate 0.32 times more return on investment than Graphene Manufacturing. However, Air Products and is 3.17 times less risky than Graphene Manufacturing. It trades about 0.08 of its potential returns per unit of risk. Graphene Manufacturing Group is currently generating about -0.03 per unit of risk. If you would invest 25,061 in Air Products and on August 28, 2024 and sell it today you would earn a total of 8,336 from holding Air Products and or generate 33.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.52% |
| Values | Daily Returns |
Air Products and vs. Graphene Manufacturing Group
Performance |
| Timeline |
| Air Products |
| Graphene Manufacturing |
Air Products and Graphene Manufacturing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Air Products and Graphene Manufacturing
The main advantage of trading using opposite Air Products and Graphene Manufacturing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Air Products position performs unexpectedly, Graphene Manufacturing 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 Graphene Manufacturing will offset losses from the drop in Graphene Manufacturing's long position.| Air Products vs. PPG Industries | Air Products vs. Ecolab Inc | Air Products vs. Sherwin Williams Co | Air Products vs. LyondellBasell Industries NV |
| Graphene Manufacturing vs. Iofina plc | Graphene Manufacturing vs. Nano One Materials | Graphene Manufacturing vs. Gevo Inc | Graphene Manufacturing vs. Haydale Graphene Industries |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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