Correlation Between Curtiss Wright and Eve Holding
Can any of the company-specific risk be diversified away by investing in both Curtiss Wright and Eve Holding 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 Eve Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Curtiss Wright and Eve Holding, you can compare the effects of market volatilities on Curtiss Wright and Eve Holding 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 Eve Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Curtiss Wright and Eve Holding.
Diversification Opportunities for Curtiss Wright and Eve Holding
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Curtiss and Eve is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Curtiss Wright and Eve Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eve Holding 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 Eve Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eve Holding has no effect on the direction of Curtiss Wright i.e., Curtiss Wright and Eve Holding go up and down completely randomly.
Pair Corralation between Curtiss Wright and Eve Holding
Allowing for the 90-day total investment horizon Curtiss Wright is expected to generate 0.39 times more return on investment than Eve Holding. However, Curtiss Wright is 2.59 times less risky than Eve Holding. It trades about 0.13 of its potential returns per unit of risk. Eve Holding is currently generating about -0.03 per unit of risk. If you would invest 16,906 in Curtiss Wright on August 27, 2024 and sell it today you would earn a total of 20,176 from holding Curtiss Wright or generate 119.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Curtiss Wright vs. Eve Holding
Performance |
| Timeline |
| Curtiss Wright |
| Eve Holding |
Curtiss Wright and Eve Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Curtiss Wright and Eve Holding
The main advantage of trading using opposite Curtiss Wright and Eve Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Curtiss Wright position performs unexpectedly, Eve Holding 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 Eve Holding will offset losses from the drop in Eve Holding's long position.| Curtiss Wright vs. Mercury Systems | Curtiss Wright vs. AAR Corp | Curtiss Wright vs. Ducommun Incorporated | Curtiss Wright vs. Moog Inc |
| Eve Holding vs. Heico | Eve Holding vs. Mercury Systems | Eve Holding vs. AeroVironment | Eve Holding vs. Howmet Aerospace |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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