Correlation Between Modine Manufacturing and SOUTHERN
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By analyzing existing cross correlation between Modine Manufacturing and SOUTHERN CALIF EDISON, you can compare the effects of market volatilities on Modine Manufacturing and SOUTHERN 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 Modine Manufacturing with a short position of SOUTHERN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Modine Manufacturing and SOUTHERN.
Diversification Opportunities for Modine Manufacturing and SOUTHERN
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Modine and SOUTHERN is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Modine Manufacturing and SOUTHERN CALIF EDISON in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SOUTHERN CALIF EDISON and Modine Manufacturing 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 Modine Manufacturing are associated (or correlated) with SOUTHERN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SOUTHERN CALIF EDISON has no effect on the direction of Modine Manufacturing i.e., Modine Manufacturing and SOUTHERN go up and down completely randomly.
Pair Corralation between Modine Manufacturing and SOUTHERN
Considering the 90-day investment horizon Modine Manufacturing is expected to generate 4.97 times less return on investment than SOUTHERN. But when comparing it to its historical volatility, Modine Manufacturing is 13.95 times less risky than SOUTHERN. It trades about 0.12 of its potential returns per unit of risk. SOUTHERN CALIF EDISON is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 8,287 in SOUTHERN CALIF EDISON on September 12, 2024 and sell it today you would earn a total of 146.00 from holding SOUTHERN CALIF EDISON or generate 1.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 81.82% |
| Values | Daily Returns |
Modine Manufacturing vs. SOUTHERN CALIF EDISON
Performance |
| Timeline |
| Modine Manufacturing |
| SOUTHERN CALIF EDISON |
Modine Manufacturing and SOUTHERN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Modine Manufacturing and SOUTHERN
The main advantage of trading using opposite Modine Manufacturing and SOUTHERN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Modine Manufacturing position performs unexpectedly, SOUTHERN 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 SOUTHERN will offset losses from the drop in SOUTHERN's long position.| Modine Manufacturing vs. Cooper Stnd | Modine Manufacturing vs. Motorcar Parts of | Modine Manufacturing vs. American Axle Manufacturing | Modine Manufacturing vs. Stoneridge |
| SOUTHERN vs. Western Asset Investment | SOUTHERN vs. Modine Manufacturing | SOUTHERN vs. CarsalesCom Ltd ADR | SOUTHERN vs. Visteon Corp |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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