Correlation Between Emerson Electric and 30321L2E1
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By analyzing existing cross correlation between Emerson Electric and FG 515 07 JUL 25, you can compare the effects of market volatilities on Emerson Electric and 30321L2E1 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 Emerson Electric with a short position of 30321L2E1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Emerson Electric and 30321L2E1.
Diversification Opportunities for Emerson Electric and 30321L2E1
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Emerson and 30321L2E1 is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Emerson Electric and FG 515 07 JUL 25 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FG 515 07 and Emerson Electric 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 Emerson Electric are associated (or correlated) with 30321L2E1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FG 515 07 has no effect on the direction of Emerson Electric i.e., Emerson Electric and 30321L2E1 go up and down completely randomly.
Pair Corralation between Emerson Electric and 30321L2E1
Considering the 90-day investment horizon Emerson Electric is expected to generate 3.82 times more return on investment than 30321L2E1. However, Emerson Electric is 3.82 times more volatile than FG 515 07 JUL 25. It trades about 0.09 of its potential returns per unit of risk. FG 515 07 JUL 25 is currently generating about -0.02 per unit of risk. If you would invest 9,427 in Emerson Electric on September 12, 2024 and sell it today you would earn a total of 3,660 from holding Emerson Electric or generate 38.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 30.65% |
| Values | Daily Returns |
Emerson Electric vs. FG 515 07 JUL 25
Performance |
| Timeline |
| Emerson Electric |
| FG 515 07 |
Emerson Electric and 30321L2E1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Emerson Electric and 30321L2E1
The main advantage of trading using opposite Emerson Electric and 30321L2E1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Emerson Electric position performs unexpectedly, 30321L2E1 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 30321L2E1 will offset losses from the drop in 30321L2E1's long position.| Emerson Electric vs. Victory Integrity Smallmid Cap | Emerson Electric vs. Hilton Worldwide Holdings | Emerson Electric vs. NVIDIA | Emerson Electric vs. JPMorgan Chase Co |
| 30321L2E1 vs. AEP TEX INC | 30321L2E1 vs. US BANK NATIONAL | 30321L2E1 vs. Alphabet Inc Class C | 30321L2E1 vs. InMode |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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