Correlation Between Genuine Parts and Intrepid Metals
Can any of the company-specific risk be diversified away by investing in both Genuine Parts and Intrepid Metals 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 Genuine Parts and Intrepid Metals into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Genuine Parts Co and Intrepid Metals Corp, you can compare the effects of market volatilities on Genuine Parts and Intrepid Metals 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 Genuine Parts with a short position of Intrepid Metals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Genuine Parts and Intrepid Metals.
Diversification Opportunities for Genuine Parts and Intrepid Metals
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Genuine and Intrepid is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Genuine Parts Co and Intrepid Metals Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intrepid Metals Corp and Genuine Parts 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 Genuine Parts Co are associated (or correlated) with Intrepid Metals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intrepid Metals Corp has no effect on the direction of Genuine Parts i.e., Genuine Parts and Intrepid Metals go up and down completely randomly.
Pair Corralation between Genuine Parts and Intrepid Metals
Considering the 90-day investment horizon Genuine Parts Co is expected to generate 0.33 times more return on investment than Intrepid Metals. However, Genuine Parts Co is 3.07 times less risky than Intrepid Metals. It trades about 0.2 of its potential returns per unit of risk. Intrepid Metals Corp is currently generating about -0.29 per unit of risk. If you would invest 11,835 in Genuine Parts Co on August 29, 2024 and sell it today you would earn a total of 955.00 from holding Genuine Parts Co or generate 8.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Genuine Parts Co vs. Intrepid Metals Corp
Performance |
| Timeline |
| Genuine Parts |
| Intrepid Metals Corp |
Genuine Parts and Intrepid Metals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Genuine Parts and Intrepid Metals
The main advantage of trading using opposite Genuine Parts and Intrepid Metals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Genuine Parts position performs unexpectedly, Intrepid Metals 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 Intrepid Metals will offset losses from the drop in Intrepid Metals' long position.| Genuine Parts vs. Dover | Genuine Parts vs. Cincinnati Financial | Genuine Parts vs. Leggett Platt Incorporated | Genuine Parts vs. WW Grainger |
| Intrepid Metals vs. JD Sports Fashion | Intrepid Metals vs. Genuine Parts Co | Intrepid Metals vs. Universal Display | Intrepid Metals vs. SunLink Health Systems |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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