Correlation Between Greenbrier Companies and Westport Fuel
Can any of the company-specific risk be diversified away by investing in both Greenbrier Companies and Westport Fuel 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 Greenbrier Companies and Westport Fuel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Greenbrier Companies and Westport Fuel Systems, you can compare the effects of market volatilities on Greenbrier Companies and Westport Fuel 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 Greenbrier Companies with a short position of Westport Fuel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Greenbrier Companies and Westport Fuel.
Diversification Opportunities for Greenbrier Companies and Westport Fuel
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Greenbrier and Westport is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Greenbrier Companies and Westport Fuel Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westport Fuel Systems and Greenbrier Companies 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 Greenbrier Companies are associated (or correlated) with Westport Fuel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westport Fuel Systems has no effect on the direction of Greenbrier Companies i.e., Greenbrier Companies and Westport Fuel go up and down completely randomly.
Pair Corralation between Greenbrier Companies and Westport Fuel
Considering the 90-day investment horizon Greenbrier Companies is expected to generate 0.87 times more return on investment than Westport Fuel. However, Greenbrier Companies is 1.14 times less risky than Westport Fuel. It trades about 0.27 of its potential returns per unit of risk. Westport Fuel Systems is currently generating about 0.14 per unit of risk. If you would invest 6,097 in Greenbrier Companies on August 30, 2024 and sell it today you would earn a total of 713.00 from holding Greenbrier Companies or generate 11.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Greenbrier Companies vs. Westport Fuel Systems
Performance |
| Timeline |
| Greenbrier Companies |
| Westport Fuel Systems |
Greenbrier Companies and Westport Fuel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Greenbrier Companies and Westport Fuel
The main advantage of trading using opposite Greenbrier Companies and Westport Fuel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Greenbrier Companies position performs unexpectedly, Westport Fuel 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 Westport Fuel will offset losses from the drop in Westport Fuel's long position.| Greenbrier Companies vs. LB Foster | Greenbrier Companies vs. Freightcar America | Greenbrier Companies vs. Westinghouse Air Brake | Greenbrier Companies vs. CSX Corporation |
| Westport Fuel vs. Foresight Autonomous Holdings | Westport Fuel vs. Hyliion Holdings Corp | Westport Fuel vs. American Axle Manufacturing | Westport Fuel vs. Gentex |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |