Correlation Between Ingersoll Rand and John Bean
Can any of the company-specific risk be diversified away by investing in both Ingersoll Rand and John Bean 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 John Bean into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ingersoll Rand and John Bean Technologies, you can compare the effects of market volatilities on Ingersoll Rand and John Bean 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 John Bean. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingersoll Rand and John Bean.
Diversification Opportunities for Ingersoll Rand and John Bean
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Ingersoll and John is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Ingersoll Rand and John Bean Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on John Bean Technologies 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 John Bean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of John Bean Technologies has no effect on the direction of Ingersoll Rand i.e., Ingersoll Rand and John Bean go up and down completely randomly.
Pair Corralation between Ingersoll Rand and John Bean
If you would invest 8,916 in Ingersoll Rand on November 8, 2024 and sell it today you would earn a total of 321.00 from holding Ingersoll Rand or generate 3.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Ingersoll Rand vs. John Bean Technologies
Performance |
| Timeline |
| Ingersoll Rand |
| John Bean Technologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ingersoll Rand and John Bean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingersoll Rand and John Bean
The main advantage of trading using opposite Ingersoll Rand and John Bean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingersoll Rand position performs unexpectedly, John Bean 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 John Bean will offset losses from the drop in John Bean's long position.| Ingersoll Rand vs. IDEX Corporation | Ingersoll Rand vs. Flowserve | Ingersoll Rand vs. Donaldson | Ingersoll Rand vs. Franklin Electric Co |
| John Bean vs. Flowserve | John Bean vs. Franklin Electric Co | John Bean vs. ITT Inc | John Bean vs. IDEX Corporation |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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