Correlation Between IMCD NV and Air Products
Can any of the company-specific risk be diversified away by investing in both IMCD NV and Air Products 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 IMCD NV and Air Products into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IMCD NV and Air Products and, you can compare the effects of market volatilities on IMCD NV and Air Products 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 IMCD NV with a short position of Air Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of IMCD NV and Air Products.
Diversification Opportunities for IMCD NV and Air Products
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between IMCD and Air is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding IMCD NV and Air Products and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Products and IMCD NV 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 IMCD NV are associated (or correlated) with Air Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Products has no effect on the direction of IMCD NV i.e., IMCD NV and Air Products go up and down completely randomly.
Pair Corralation between IMCD NV and Air Products
Assuming the 90 days horizon IMCD NV is expected to generate 1.69 times more return on investment than Air Products. However, IMCD NV is 1.69 times more volatile than Air Products and. It trades about 0.01 of its potential returns per unit of risk. Air Products and is currently generating about 0.01 per unit of risk. If you would invest 15,270 in IMCD NV on September 19, 2024 and sell it today you would lose (70.00) from holding IMCD NV or give up 0.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 64.11% |
| Values | Daily Returns |
IMCD NV vs. Air Products and
Performance |
| Timeline |
| IMCD NV |
| Air Products |
IMCD NV and Air Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IMCD NV and Air Products
The main advantage of trading using opposite IMCD NV and Air Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IMCD NV position performs unexpectedly, Air Products 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 Air Products will offset losses from the drop in Air Products' long position.| IMCD NV vs. Air Products and | IMCD NV vs. PPG Industries | IMCD NV vs. Sherwin Williams Co | IMCD NV vs. Ecolab Inc |
| Air Products vs. PPG Industries | Air Products vs. Sherwin Williams Co | Air Products vs. Ecolab Inc | Air Products vs. Albemarle Corp |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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