Correlation Between Franklin Electric and CIRCOR International
Can any of the company-specific risk be diversified away by investing in both Franklin Electric and CIRCOR International 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 Franklin Electric and CIRCOR International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Electric Co and CIRCOR International, you can compare the effects of market volatilities on Franklin Electric and CIRCOR International 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 Franklin Electric with a short position of CIRCOR International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Electric and CIRCOR International.
Diversification Opportunities for Franklin Electric and CIRCOR International
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Franklin and CIRCOR is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Electric Co and CIRCOR International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIRCOR International and Franklin 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 Franklin Electric Co are associated (or correlated) with CIRCOR International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIRCOR International has no effect on the direction of Franklin Electric i.e., Franklin Electric and CIRCOR International go up and down completely randomly.
Pair Corralation between Franklin Electric and CIRCOR International
If you would invest 9,640 in Franklin Electric Co on November 4, 2024 and sell it today you would earn a total of 359.00 from holding Franklin Electric Co or generate 3.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 5.0% |
| Values | Daily Returns |
Franklin Electric Co vs. CIRCOR International
Performance |
| Timeline |
| Franklin Electric |
| CIRCOR International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Franklin Electric and CIRCOR International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Electric and CIRCOR International
The main advantage of trading using opposite Franklin Electric and CIRCOR International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Electric position performs unexpectedly, CIRCOR International 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 CIRCOR International will offset losses from the drop in CIRCOR International's long position.| Franklin Electric vs. Graco Inc | Franklin Electric vs. Ametek Inc | Franklin Electric vs. Flowserve | Franklin Electric vs. Donaldson |
| CIRCOR International vs. Helios Technologies | CIRCOR International vs. Enpro Industries | CIRCOR International vs. Omega Flex | CIRCOR International vs. Luxfer Holdings PLC |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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