Correlation Between Crane and Intevac
Can any of the company-specific risk be diversified away by investing in both Crane and Intevac 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 Crane and Intevac into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crane Company and Intevac, you can compare the effects of market volatilities on Crane and Intevac 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 Crane with a short position of Intevac. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crane and Intevac.
Diversification Opportunities for Crane and Intevac
Pay attention - limited upside
The 3 months correlation between Crane and Intevac is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Crane Company and Intevac in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intevac and Crane 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 Crane Company are associated (or correlated) with Intevac. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intevac has no effect on the direction of Crane i.e., Crane and Intevac go up and down completely randomly.
Pair Corralation between Crane and Intevac
Allowing for the 90-day total investment horizon Crane Company is expected to generate 0.37 times more return on investment than Intevac. However, Crane Company is 2.73 times less risky than Intevac. It trades about 0.38 of its potential returns per unit of risk. Intevac is currently generating about -0.14 per unit of risk. If you would invest 15,884 in Crane Company on August 30, 2024 and sell it today you would earn a total of 2,612 from holding Crane Company or generate 16.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Crane Company vs. Intevac
Performance |
| Timeline |
| Crane Company |
| Intevac |
Crane and Intevac Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crane and Intevac
The main advantage of trading using opposite Crane and Intevac positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crane position performs unexpectedly, Intevac 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 Intevac will offset losses from the drop in Intevac's long position.| Crane vs. Standex International | Crane vs. Donaldson | Crane vs. CSW Industrials | Crane vs. Franklin Electric Co |
| Intevac vs. Rigetti Computing | Intevac vs. D Wave Quantum | Intevac vs. IONQ Inc | Intevac vs. Desktop Metal |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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