Correlation Between Ingersoll Rand and ATS
Can any of the company-specific risk be diversified away by investing in both Ingersoll Rand and ATS 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 Ingersoll Rand and ATS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ingersoll Rand and ATS Corporation, you can compare the effects of market volatilities on Ingersoll Rand and ATS 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 Ingersoll Rand with a short position of ATS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingersoll Rand and ATS.
Diversification Opportunities for Ingersoll Rand and ATS
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ingersoll and ATS is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Ingersoll Rand and ATS Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATS Corporation and Ingersoll Rand 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 Ingersoll Rand are associated (or correlated) with ATS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATS Corporation has no effect on the direction of Ingersoll Rand i.e., Ingersoll Rand and ATS go up and down completely randomly.
Pair Corralation between Ingersoll Rand and ATS
Allowing for the 90-day total investment horizon Ingersoll Rand is expected to generate 0.77 times more return on investment than ATS. However, Ingersoll Rand is 1.29 times less risky than ATS. It trades about 0.09 of its potential returns per unit of risk. ATS Corporation is currently generating about 0.0 per unit of risk. If you would invest 5,262 in Ingersoll Rand on August 27, 2024 and sell it today you would earn a total of 5,138 from holding Ingersoll Rand or generate 97.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ingersoll Rand vs. ATS Corp.
Performance |
| Timeline |
| Ingersoll Rand |
| ATS Corporation |
Ingersoll Rand and ATS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingersoll Rand and ATS
The main advantage of trading using opposite Ingersoll Rand and ATS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingersoll Rand position performs unexpectedly, ATS 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 ATS will offset losses from the drop in ATS's long position.| Ingersoll Rand vs. IDEX Corporation | Ingersoll Rand vs. Flowserve | Ingersoll Rand vs. Donaldson | Ingersoll Rand vs. Franklin Electric Co |
| ATS vs. Aquagold International | ATS vs. Morningstar Unconstrained Allocation | ATS vs. High Yield Municipal Fund | ATS vs. Thrivent High Yield |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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