Correlation Between Nutanix and CIRCOR International
Can any of the company-specific risk be diversified away by investing in both Nutanix and CIRCOR International 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 Nutanix and CIRCOR International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nutanix and CIRCOR International, you can compare the effects of market volatilities on Nutanix and CIRCOR International 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 Nutanix with a short position of CIRCOR International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nutanix and CIRCOR International.
Diversification Opportunities for Nutanix and CIRCOR International
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nutanix and CIRCOR is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Nutanix and CIRCOR International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIRCOR International and Nutanix 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 Nutanix are associated (or correlated) with CIRCOR International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIRCOR International has no effect on the direction of Nutanix i.e., Nutanix and CIRCOR International go up and down completely randomly.
Pair Corralation between Nutanix and CIRCOR International
Given the investment horizon of 90 days Nutanix is expected to generate 2.6 times less return on investment than CIRCOR International. But when comparing it to its historical volatility, Nutanix is 1.84 times less risky than CIRCOR International. It trades about 0.08 of its potential returns per unit of risk. CIRCOR International is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 2,705 in CIRCOR International on August 24, 2024 and sell it today you would earn a total of 2,880 from holding CIRCOR International or generate 106.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 32.06% |
| Values | Daily Returns |
Nutanix vs. CIRCOR International
Performance |
| Timeline |
| Nutanix |
| CIRCOR International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Nutanix and CIRCOR International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nutanix and CIRCOR International
The main advantage of trading using opposite Nutanix and CIRCOR International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nutanix position performs unexpectedly, CIRCOR International 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 CIRCOR International will offset losses from the drop in CIRCOR International's long position.| Nutanix vs. Palo Alto Networks | Nutanix vs. Uipath Inc | Nutanix vs. Zscaler | Nutanix vs. Crowdstrike Holdings |
| CIRCOR International vs. Helios Technologies | CIRCOR International vs. Enpro Industries | CIRCOR International vs. Omega Flex | CIRCOR International vs. Luxfer Holdings PLC |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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