Correlation Between Curtiss Wright and Ammo
Can any of the company-specific risk be diversified away by investing in both Curtiss Wright and Ammo 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 Ammo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Curtiss Wright and Ammo Inc, you can compare the effects of market volatilities on Curtiss Wright and Ammo 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 Ammo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Curtiss Wright and Ammo.
Diversification Opportunities for Curtiss Wright and Ammo
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Curtiss and Ammo is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Curtiss Wright and Ammo Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ammo Inc 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 Ammo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ammo Inc has no effect on the direction of Curtiss Wright i.e., Curtiss Wright and Ammo go up and down completely randomly.
Pair Corralation between Curtiss Wright and Ammo
Allowing for the 90-day total investment horizon Curtiss Wright is expected to generate 0.35 times more return on investment than Ammo. However, Curtiss Wright is 2.88 times less risky than Ammo. It trades about 0.16 of its potential returns per unit of risk. Ammo Inc is currently generating about -0.01 per unit of risk. If you would invest 17,384 in Curtiss Wright on August 31, 2024 and sell it today you would earn a total of 19,979 from holding Curtiss Wright or generate 114.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Curtiss Wright vs. Ammo Inc
Performance |
| Timeline |
| Curtiss Wright |
| Ammo Inc |
Curtiss Wright and Ammo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Curtiss Wright and Ammo
The main advantage of trading using opposite Curtiss Wright and Ammo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Curtiss Wright position performs unexpectedly, Ammo 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 Ammo will offset losses from the drop in Ammo's long position.| Curtiss Wright vs. Mercury Systems | Curtiss Wright vs. AAR Corp | Curtiss Wright vs. Ducommun Incorporated | Curtiss Wright vs. Moog Inc |
| Ammo vs. Sturm Ruger | Ammo vs. Kratos Defense Security | Ammo vs. VSE Corporation | Ammo vs. Smith Wesson Brands |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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