Correlation Between Barnes and Nidec
Can any of the company-specific risk be diversified away by investing in both Barnes and Nidec 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 Barnes and Nidec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barnes Group and Nidec, you can compare the effects of market volatilities on Barnes and Nidec 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 Barnes with a short position of Nidec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barnes and Nidec.
Diversification Opportunities for Barnes and Nidec
Pay attention - limited upside
The 3 months correlation between Barnes and Nidec is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Barnes Group and Nidec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nidec and Barnes 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 Barnes Group are associated (or correlated) with Nidec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nidec has no effect on the direction of Barnes i.e., Barnes and Nidec go up and down completely randomly.
Pair Corralation between Barnes and Nidec
If you would invest 3,976 in Barnes Group on August 25, 2024 and sell it today you would earn a total of 706.00 from holding Barnes Group or generate 17.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 2.22% |
| Values | Daily Returns |
Barnes Group vs. Nidec
Performance |
| Timeline |
| Barnes Group |
| Nidec |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Barnes and Nidec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barnes and Nidec
The main advantage of trading using opposite Barnes and Nidec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barnes position performs unexpectedly, Nidec 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 Nidec will offset losses from the drop in Nidec's long position.| Barnes vs. Helios Technologies | Barnes vs. Enpro Industries | Barnes vs. Omega Flex | Barnes vs. Luxfer Holdings PLC |
| Nidec vs. Daifuku Co | Nidec vs. Eaton PLC | Nidec vs. Yokogawa Electric Corp | Nidec vs. Brewbilt Manufacturing |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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