Correlation Between John Bean and Thermwood
Can any of the company-specific risk be diversified away by investing in both John Bean and Thermwood 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 John Bean and Thermwood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between John Bean Technologies and Thermwood, you can compare the effects of market volatilities on John Bean and Thermwood 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 John Bean with a short position of Thermwood. Check out your portfolio center. Please also check ongoing floating volatility patterns of John Bean and Thermwood.
Diversification Opportunities for John Bean and Thermwood
Excellent diversification
The 3 months correlation between John and Thermwood is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding John Bean Technologies and Thermwood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thermwood and John Bean 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 John Bean Technologies are associated (or correlated) with Thermwood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thermwood has no effect on the direction of John Bean i.e., John Bean and Thermwood go up and down completely randomly.
Pair Corralation between John Bean and Thermwood
If you would invest 11,848 in John Bean Technologies on September 12, 2024 and sell it today you would earn a total of 653.00 from holding John Bean Technologies or generate 5.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
John Bean Technologies vs. Thermwood
Performance |
| Timeline |
| John Bean Technologies |
| Thermwood |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
John Bean and Thermwood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with John Bean and Thermwood
The main advantage of trading using opposite John Bean and Thermwood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if John Bean position performs unexpectedly, Thermwood 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 Thermwood will offset losses from the drop in Thermwood's long position.| John Bean vs. Pentair PLC | John Bean vs. Parker Hannifin | John Bean vs. Emerson Electric | John Bean vs. Smith AO |
| Thermwood vs. John Bean Technologies | Thermwood vs. Helios Technologies | Thermwood vs. Middleby Corp | Thermwood vs. Flowserve |
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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