Correlation Between RBC Bearings and AMERICAN
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By analyzing existing cross correlation between RBC Bearings Incorporated and AMERICAN EXPRESS PANY, you can compare the effects of market volatilities on RBC Bearings and AMERICAN 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 RBC Bearings with a short position of AMERICAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of RBC Bearings and AMERICAN.
Diversification Opportunities for RBC Bearings and AMERICAN
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between RBC and AMERICAN is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding RBC Bearings Incorporated and AMERICAN EXPRESS PANY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMERICAN EXPRESS PANY and RBC Bearings 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 RBC Bearings Incorporated are associated (or correlated) with AMERICAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMERICAN EXPRESS PANY has no effect on the direction of RBC Bearings i.e., RBC Bearings and AMERICAN go up and down completely randomly.
Pair Corralation between RBC Bearings and AMERICAN
Considering the 90-day investment horizon RBC Bearings Incorporated is expected to generate 3.05 times more return on investment than AMERICAN. However, RBC Bearings is 3.05 times more volatile than AMERICAN EXPRESS PANY. It trades about 0.2 of its potential returns per unit of risk. AMERICAN EXPRESS PANY is currently generating about -0.14 per unit of risk. If you would invest 31,537 in RBC Bearings Incorporated on September 13, 2024 and sell it today you would earn a total of 1,625 from holding RBC Bearings Incorporated or generate 5.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
RBC Bearings Incorporated vs. AMERICAN EXPRESS PANY
Performance |
| Timeline |
| RBC Bearings |
| AMERICAN EXPRESS PANY |
RBC Bearings and AMERICAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with RBC Bearings and AMERICAN
The main advantage of trading using opposite RBC Bearings and AMERICAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if RBC Bearings position performs unexpectedly, AMERICAN 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 AMERICAN will offset losses from the drop in AMERICAN's long position.| RBC Bearings vs. Lincoln Electric Holdings | RBC Bearings vs. Kennametal | RBC Bearings vs. Toro Co | RBC Bearings vs. Snap On |
| AMERICAN vs. Molson Coors Brewing | AMERICAN vs. Celsius Holdings | AMERICAN vs. Tencent Music Entertainment | AMERICAN vs. Datadog |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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