Correlation Between Crawford United and Weir Group
Can any of the company-specific risk be diversified away by investing in both Crawford United and Weir Group 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 Crawford United and Weir Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Crawford United and Weir Group PLC, you can compare the effects of market volatilities on Crawford United and Weir Group 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 Crawford United with a short position of Weir Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crawford United and Weir Group.
Diversification Opportunities for Crawford United and Weir Group
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Crawford and Weir is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Crawford United and Weir Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weir Group PLC and Crawford United 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 Crawford United are associated (or correlated) with Weir Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weir Group PLC has no effect on the direction of Crawford United i.e., Crawford United and Weir Group go up and down completely randomly.
Pair Corralation between Crawford United and Weir Group
Assuming the 90 days horizon Crawford United is expected to generate 1.74 times more return on investment than Weir Group. However, Crawford United is 1.74 times more volatile than Weir Group PLC. It trades about 0.15 of its potential returns per unit of risk. Weir Group PLC is currently generating about 0.05 per unit of risk. If you would invest 1,448 in Crawford United on September 3, 2024 and sell it today you would earn a total of 1,174 from holding Crawford United or generate 81.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 31.4% |
| Values | Daily Returns |
Crawford United vs. Weir Group PLC
Performance |
| Timeline |
| Crawford United |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Weir Group PLC |
Crawford United and Weir Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Crawford United and Weir Group
The main advantage of trading using opposite Crawford United and Weir Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Crawford United position performs unexpectedly, Weir Group 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 Weir Group will offset losses from the drop in Weir Group's long position.| Crawford United vs. New Ulm Telecom | Crawford United vs. Ieh Corp | Crawford United vs. FitLife Brands, Common | Crawford United vs. Butler National Corp |
| Weir Group vs. Dear Cashmere Holding | Weir Group vs. Goff Corp | Weir Group vs. Wialan Technologies | Weir Group vs. Cgrowth Capital |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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