Correlation Between Caterpillar and Getty
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By analyzing existing cross correlation between Caterpillar and Getty Images 975, you can compare the effects of market volatilities on Caterpillar and Getty 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 Caterpillar with a short position of Getty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caterpillar and Getty.
Diversification Opportunities for Caterpillar and Getty
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Caterpillar and Getty is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Caterpillar and Getty Images 975 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Getty Images 975 and Caterpillar 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 Caterpillar are associated (or correlated) with Getty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Getty Images 975 has no effect on the direction of Caterpillar i.e., Caterpillar and Getty go up and down completely randomly.
Pair Corralation between Caterpillar and Getty
Considering the 90-day investment horizon Caterpillar is expected to generate 14.09 times more return on investment than Getty. However, Caterpillar is 14.09 times more volatile than Getty Images 975. It trades about 0.13 of its potential returns per unit of risk. Getty Images 975 is currently generating about -0.02 per unit of risk. If you would invest 37,924 in Caterpillar on August 31, 2024 and sell it today you would earn a total of 2,446 from holding Caterpillar or generate 6.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 63.64% |
| Values | Daily Returns |
Caterpillar vs. Getty Images 975
Performance |
| Timeline |
| Caterpillar |
| Getty Images 975 |
Caterpillar and Getty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caterpillar and Getty
The main advantage of trading using opposite Caterpillar and Getty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caterpillar position performs unexpectedly, Getty 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 Getty will offset losses from the drop in Getty's long position.| Caterpillar vs. Deere Company | Caterpillar vs. Lindsay | Caterpillar vs. Alamo Group | Caterpillar vs. Manitowoc |
| Getty vs. Origin Materials | Getty vs. Reservoir Media | Getty vs. Avient Corp | Getty vs. Sensient Technologies |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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