Correlation Between Ingersoll Rand and Nidec
Can any of the company-specific risk be diversified away by investing in both Ingersoll Rand and Nidec 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 Nidec into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ingersoll Rand and Nidec, you can compare the effects of market volatilities on Ingersoll Rand and Nidec 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 Nidec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingersoll Rand and Nidec.
Diversification Opportunities for Ingersoll Rand and Nidec
-0.36 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ingersoll and Nidec is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding Ingersoll Rand and Nidec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nidec 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 Nidec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nidec has no effect on the direction of Ingersoll Rand i.e., Ingersoll Rand and Nidec go up and down completely randomly.
Pair Corralation between Ingersoll Rand and Nidec
If you would invest 9,709 in Ingersoll Rand on August 29, 2024 and sell it today you would earn a total of 765.00 from holding Ingersoll Rand or generate 7.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Ingersoll Rand vs. Nidec
Performance |
| Timeline |
| Ingersoll Rand |
| Nidec |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Ingersoll Rand and Nidec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingersoll Rand and Nidec
The main advantage of trading using opposite Ingersoll Rand and Nidec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingersoll Rand position performs unexpectedly, Nidec 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 Nidec will offset losses from the drop in Nidec's long position.| Ingersoll Rand vs. IDEX Corporation | Ingersoll Rand vs. Flowserve | Ingersoll Rand vs. Donaldson | Ingersoll Rand vs. Franklin Electric Co |
| Nidec vs. Daifuku Co | Nidec vs. Eaton PLC | Nidec vs. Yokogawa Electric Corp | Nidec vs. Brewbilt Manufacturing |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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