Correlation Between Core Molding and Ingevity Corp
Can any of the company-specific risk be diversified away by investing in both Core Molding and Ingevity Corp 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 Core Molding and Ingevity Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Core Molding Technologies and Ingevity Corp, you can compare the effects of market volatilities on Core Molding and Ingevity Corp 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 Core Molding with a short position of Ingevity Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Core Molding and Ingevity Corp.
Diversification Opportunities for Core Molding and Ingevity Corp
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Core and Ingevity is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Core Molding Technologies and Ingevity Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ingevity Corp and Core Molding 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 Core Molding Technologies are associated (or correlated) with Ingevity Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ingevity Corp has no effect on the direction of Core Molding i.e., Core Molding and Ingevity Corp go up and down completely randomly.
Pair Corralation between Core Molding and Ingevity Corp
Considering the 90-day investment horizon Core Molding is expected to generate 15.82 times less return on investment than Ingevity Corp. But when comparing it to its historical volatility, Core Molding Technologies is 1.75 times less risky than Ingevity Corp. It trades about 0.01 of its potential returns per unit of risk. Ingevity Corp is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 3,871 in Ingevity Corp on August 28, 2024 and sell it today you would earn a total of 1,150 from holding Ingevity Corp or generate 29.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Core Molding Technologies vs. Ingevity Corp
Performance |
| Timeline |
| Core Molding Technologies |
| Ingevity Corp |
Core Molding and Ingevity Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Core Molding and Ingevity Corp
The main advantage of trading using opposite Core Molding and Ingevity Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Core Molding position performs unexpectedly, Ingevity Corp 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 Ingevity Corp will offset losses from the drop in Ingevity Corp's long position.| Core Molding vs. Innospec | Core Molding vs. H B Fuller | Core Molding vs. Quaker Chemical | Core Molding vs. Minerals Technologies |
| Ingevity Corp vs. Oil Dri | Ingevity Corp vs. H B Fuller | Ingevity Corp vs. Northern Technologies | Ingevity Corp vs. Cabot |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |