Correlation Between Curtiss Wright and Brinks
Can any of the company-specific risk be diversified away by investing in both Curtiss Wright and Brinks 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 Curtiss Wright and Brinks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Curtiss Wright and Brinks Company, you can compare the effects of market volatilities on Curtiss Wright and Brinks 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 Curtiss Wright with a short position of Brinks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Curtiss Wright and Brinks.
Diversification Opportunities for Curtiss Wright and Brinks
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Curtiss and Brinks is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Curtiss Wright and Brinks Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brinks Company and Curtiss Wright 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 Curtiss Wright are associated (or correlated) with Brinks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brinks Company has no effect on the direction of Curtiss Wright i.e., Curtiss Wright and Brinks go up and down completely randomly.
Pair Corralation between Curtiss Wright and Brinks
Allowing for the 90-day total investment horizon Curtiss Wright is expected to generate 1.26 times more return on investment than Brinks. However, Curtiss Wright is 1.26 times more volatile than Brinks Company. It trades about 0.11 of its potential returns per unit of risk. Brinks Company is currently generating about -0.18 per unit of risk. If you would invest 35,354 in Curtiss Wright on August 31, 2024 and sell it today you would earn a total of 1,783 from holding Curtiss Wright or generate 5.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Curtiss Wright vs. Brinks Company
Performance |
| Timeline |
| Curtiss Wright |
| Brinks Company |
Curtiss Wright and Brinks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Curtiss Wright and Brinks
The main advantage of trading using opposite Curtiss Wright and Brinks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Curtiss Wright position performs unexpectedly, Brinks 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 Brinks will offset losses from the drop in Brinks' long position.| Curtiss Wright vs. Mercury Systems | Curtiss Wright vs. AAR Corp | Curtiss Wright vs. Ducommun Incorporated | Curtiss Wright vs. Moog Inc |
| Brinks vs. MSA Safety | Brinks vs. Resideo Technologies | Brinks vs. Mistras Group | Brinks vs. NL Industries |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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