Correlation Between Ingersoll Rand and Mirion Technologies
Can any of the company-specific risk be diversified away by investing in both Ingersoll Rand and Mirion Technologies 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 Mirion Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ingersoll Rand and Mirion Technologies, you can compare the effects of market volatilities on Ingersoll Rand and Mirion Technologies 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 Mirion Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingersoll Rand and Mirion Technologies.
Diversification Opportunities for Ingersoll Rand and Mirion Technologies
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Ingersoll and Mirion is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Ingersoll Rand and Mirion Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mirion 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 Mirion Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mirion Technologies has no effect on the direction of Ingersoll Rand i.e., Ingersoll Rand and Mirion Technologies go up and down completely randomly.
Pair Corralation between Ingersoll Rand and Mirion Technologies
Allowing for the 90-day total investment horizon Ingersoll Rand is expected to generate 1.52 times less return on investment than Mirion Technologies. But when comparing it to its historical volatility, Ingersoll Rand is 1.48 times less risky than Mirion Technologies. It trades about 0.09 of its potential returns per unit of risk. Mirion Technologies is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 618.00 in Mirion Technologies on August 24, 2024 and sell it today you would earn a total of 1,010 from holding Mirion Technologies or generate 163.43% 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. Mirion Technologies
Performance |
| Timeline |
| Ingersoll Rand |
| Mirion Technologies |
Ingersoll Rand and Mirion Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingersoll Rand and Mirion Technologies
The main advantage of trading using opposite Ingersoll Rand and Mirion Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingersoll Rand position performs unexpectedly, Mirion Technologies 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 Mirion Technologies will offset losses from the drop in Mirion Technologies' long position.| Ingersoll Rand vs. Small Cap Core | Ingersoll Rand vs. Freedom Holding Corp | Ingersoll Rand vs. Gfl Environmental Holdings | Ingersoll Rand vs. Growth Fund Of |
| Mirion Technologies vs. Enpro Industries | Mirion Technologies vs. Graham | Mirion Technologies vs. CSW Industrials | Mirion Technologies vs. Gorman Rupp |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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