Correlation Between Intel and Altra Industrial
Can any of the company-specific risk be diversified away by investing in both Intel and Altra Industrial 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 Intel and Altra Industrial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel and Altra Industrial Motion, you can compare the effects of market volatilities on Intel and Altra Industrial 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 Intel with a short position of Altra Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and Altra Industrial.
Diversification Opportunities for Intel and Altra Industrial
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Intel and Altra is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Intel and Altra Industrial Motion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Altra Industrial Motion and Intel 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 Intel are associated (or correlated) with Altra Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Altra Industrial Motion has no effect on the direction of Intel i.e., Intel and Altra Industrial go up and down completely randomly.
Pair Corralation between Intel and Altra Industrial
If you would invest 2,152 in Intel on September 1, 2024 and sell it today you would earn a total of 253.00 from holding Intel or generate 11.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Intel vs. Altra Industrial Motion
Performance |
| Timeline |
| Intel |
| Altra Industrial Motion |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Intel and Altra Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intel and Altra Industrial
The main advantage of trading using opposite Intel and Altra Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel position performs unexpectedly, Altra Industrial 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 Altra Industrial will offset losses from the drop in Altra Industrial's long position.| Intel vs. NXP Semiconductors NV | Intel vs. GSI Technology | Intel vs. MaxLinear | Intel vs. Texas Instruments Incorporated |
| Altra Industrial vs. Franklin Electric Co | Altra Industrial vs. Donaldson | Altra Industrial vs. John Bean Technologies | Altra Industrial vs. ITT Inc |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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