Correlation Between Ibstock Plc and Eagle Materials
Can any of the company-specific risk be diversified away by investing in both Ibstock Plc and Eagle Materials 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 Ibstock Plc and Eagle Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ibstock Plc and Eagle Materials, you can compare the effects of market volatilities on Ibstock Plc and Eagle Materials 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 Ibstock Plc with a short position of Eagle Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ibstock Plc and Eagle Materials.
Diversification Opportunities for Ibstock Plc and Eagle Materials
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ibstock and Eagle is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Ibstock Plc and Eagle Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eagle Materials and Ibstock Plc 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 Ibstock Plc are associated (or correlated) with Eagle Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eagle Materials has no effect on the direction of Ibstock Plc i.e., Ibstock Plc and Eagle Materials go up and down completely randomly.
Pair Corralation between Ibstock Plc and Eagle Materials
If you would invest 24,828 in Eagle Materials on October 26, 2024 and sell it today you would earn a total of 1,388 from holding Eagle Materials or generate 5.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 14.52% |
| Values | Daily Returns |
Ibstock Plc vs. Eagle Materials
Performance |
| Timeline |
| Ibstock Plc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Eagle Materials |
Ibstock Plc and Eagle Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ibstock Plc and Eagle Materials
The main advantage of trading using opposite Ibstock Plc and Eagle Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ibstock Plc position performs unexpectedly, Eagle Materials 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 Eagle Materials will offset losses from the drop in Eagle Materials' long position.| Ibstock Plc vs. Xinyi Glass Holdings | Ibstock Plc vs. CEMATRIX | Ibstock Plc vs. Anhui Conch Cement | Ibstock Plc vs. Basanite |
| Eagle Materials vs. Vulcan Materials | Eagle Materials vs. CRH PLC ADR | Eagle Materials vs. Summit Materials | Eagle Materials vs. Cemex SAB de |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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