Correlation Between Curtiss Wright and Park Electrochemical
Can any of the company-specific risk be diversified away by investing in both Curtiss Wright and Park Electrochemical 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 Park Electrochemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Curtiss Wright and Park Electrochemical, you can compare the effects of market volatilities on Curtiss Wright and Park Electrochemical 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 Park Electrochemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Curtiss Wright and Park Electrochemical.
Diversification Opportunities for Curtiss Wright and Park Electrochemical
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Curtiss and Park is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Curtiss Wright and Park Electrochemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Park Electrochemical 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 Park Electrochemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Park Electrochemical has no effect on the direction of Curtiss Wright i.e., Curtiss Wright and Park Electrochemical go up and down completely randomly.
Pair Corralation between Curtiss Wright and Park Electrochemical
Allowing for the 90-day total investment horizon Curtiss Wright is expected to generate 0.47 times more return on investment than Park Electrochemical. However, Curtiss Wright is 2.14 times less risky than Park Electrochemical. It trades about 0.24 of its potential returns per unit of risk. Park Electrochemical is currently generating about 0.11 per unit of risk. If you would invest 35,144 in Curtiss Wright on October 20, 2024 and sell it today you would earn a total of 1,548 from holding Curtiss Wright or generate 4.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Curtiss Wright vs. Park Electrochemical
Performance |
| Timeline |
| Curtiss Wright |
| Park Electrochemical |
Curtiss Wright and Park Electrochemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Curtiss Wright and Park Electrochemical
The main advantage of trading using opposite Curtiss Wright and Park Electrochemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Curtiss Wright position performs unexpectedly, Park Electrochemical 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 Park Electrochemical will offset losses from the drop in Park Electrochemical's long position.| Curtiss Wright vs. Mercury Systems | Curtiss Wright vs. AAR Corp | Curtiss Wright vs. Ducommun Incorporated | Curtiss Wright vs. Moog Inc |
| Park Electrochemical vs. Innovative Solutions and | Park Electrochemical vs. VSE Corporation | Park Electrochemical vs. Curtiss Wright | Park Electrochemical vs. Ducommun Incorporated |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |