Correlation Between Core Molding and Orion Engineered
Can any of the company-specific risk be diversified away by investing in both Core Molding and Orion Engineered 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 Orion Engineered 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 Orion Engineered Carbons, you can compare the effects of market volatilities on Core Molding and Orion Engineered 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 Orion Engineered. Check out your portfolio center. Please also check ongoing floating volatility patterns of Core Molding and Orion Engineered.
Diversification Opportunities for Core Molding and Orion Engineered
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Core and Orion is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Core Molding Technologies and Orion Engineered Carbons in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orion Engineered Carbons 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 Orion Engineered. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orion Engineered Carbons has no effect on the direction of Core Molding i.e., Core Molding and Orion Engineered go up and down completely randomly.
Pair Corralation between Core Molding and Orion Engineered
Considering the 90-day investment horizon Core Molding Technologies is expected to generate 1.23 times more return on investment than Orion Engineered. However, Core Molding is 1.23 times more volatile than Orion Engineered Carbons. It trades about 0.05 of its potential returns per unit of risk. Orion Engineered Carbons is currently generating about 0.01 per unit of risk. If you would invest 1,050 in Core Molding Technologies on August 24, 2024 and sell it today you would earn a total of 688.00 from holding Core Molding Technologies or generate 65.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Core Molding Technologies vs. Orion Engineered Carbons
Performance |
| Timeline |
| Core Molding Technologies |
| Orion Engineered Carbons |
Core Molding and Orion Engineered Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Core Molding and Orion Engineered
The main advantage of trading using opposite Core Molding and Orion Engineered positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Core Molding position performs unexpectedly, Orion Engineered 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 Orion Engineered will offset losses from the drop in Orion Engineered's long position.| Core Molding vs. Innospec | Core Molding vs. H B Fuller | Core Molding vs. Quaker Chemical | Core Molding vs. Minerals Technologies |
| Orion Engineered vs. Eshallgo Class A | Orion Engineered vs. Amtech Systems | Orion Engineered vs. Gold Fields Ltd | Orion Engineered vs. Aegean Airlines SA |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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