Correlation Between Ingersoll Rand and Mobile Infrastructure
Can any of the company-specific risk be diversified away by investing in both Ingersoll Rand and Mobile Infrastructure 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 Mobile Infrastructure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ingersoll Rand and Mobile Infrastructure, you can compare the effects of market volatilities on Ingersoll Rand and Mobile Infrastructure 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 Mobile Infrastructure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingersoll Rand and Mobile Infrastructure.
Diversification Opportunities for Ingersoll Rand and Mobile Infrastructure
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ingersoll and Mobile is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Ingersoll Rand and Mobile Infrastructure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mobile Infrastructure 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 Mobile Infrastructure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mobile Infrastructure has no effect on the direction of Ingersoll Rand i.e., Ingersoll Rand and Mobile Infrastructure go up and down completely randomly.
Pair Corralation between Ingersoll Rand and Mobile Infrastructure
Allowing for the 90-day total investment horizon Ingersoll Rand is expected to generate 0.22 times more return on investment than Mobile Infrastructure. However, Ingersoll Rand is 4.55 times less risky than Mobile Infrastructure. It trades about 0.09 of its potential returns per unit of risk. Mobile Infrastructure 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 Against |
| Strength | Insignificant |
| Accuracy | 96.37% |
| Values | Daily Returns |
Ingersoll Rand vs. Mobile Infrastructure
Performance |
| Timeline |
| Ingersoll Rand |
| Mobile Infrastructure |
Ingersoll Rand and Mobile Infrastructure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingersoll Rand and Mobile Infrastructure
The main advantage of trading using opposite Ingersoll Rand and Mobile Infrastructure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingersoll Rand position performs unexpectedly, Mobile Infrastructure 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 Mobile Infrastructure will offset losses from the drop in Mobile Infrastructure's long position.| Ingersoll Rand vs. IDEX Corporation | Ingersoll Rand vs. Flowserve | Ingersoll Rand vs. Donaldson | Ingersoll Rand vs. Franklin Electric Co |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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