Correlation Between Flowserve and Intevac
Can any of the company-specific risk be diversified away by investing in both Flowserve and Intevac 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 Flowserve and Intevac into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flowserve and Intevac, you can compare the effects of market volatilities on Flowserve and Intevac 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 Flowserve with a short position of Intevac. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flowserve and Intevac.
Diversification Opportunities for Flowserve and Intevac
Excellent diversification
The 3 months correlation between Flowserve and Intevac is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Flowserve and Intevac in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intevac and Flowserve 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 Flowserve are associated (or correlated) with Intevac. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intevac has no effect on the direction of Flowserve i.e., Flowserve and Intevac go up and down completely randomly.
Pair Corralation between Flowserve and Intevac
Considering the 90-day investment horizon Flowserve is expected to generate 0.39 times more return on investment than Intevac. However, Flowserve is 2.54 times less risky than Intevac. It trades about 0.28 of its potential returns per unit of risk. Intevac is currently generating about -0.14 per unit of risk. If you would invest 5,376 in Flowserve on August 31, 2024 and sell it today you would earn a total of 697.00 from holding Flowserve or generate 12.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flowserve vs. Intevac
Performance |
| Timeline |
| Flowserve |
| Intevac |
Flowserve and Intevac Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flowserve and Intevac
The main advantage of trading using opposite Flowserve and Intevac positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flowserve position performs unexpectedly, Intevac 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 Intevac will offset losses from the drop in Intevac's long position.| Flowserve vs. IDEX Corporation | Flowserve vs. Donaldson | Flowserve vs. Ingersoll Rand | Flowserve vs. Franklin Electric Co |
| Intevac vs. Innovative Solutions and | Intevac vs. Heidrick Struggles International | Intevac vs. ICF International | Intevac vs. PDF Solutions |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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