Correlation Between Spectra Systems and Air Products
Can any of the company-specific risk be diversified away by investing in both Spectra Systems and Air Products 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 Spectra Systems and Air Products into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spectra Systems and Air Products and, you can compare the effects of market volatilities on Spectra Systems and Air Products 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 Spectra Systems with a short position of Air Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spectra Systems and Air Products.
Diversification Opportunities for Spectra Systems and Air Products
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Spectra and Air is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Spectra Systems and Air Products and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Air Products and Spectra Systems 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 Spectra Systems are associated (or correlated) with Air Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Air Products has no effect on the direction of Spectra Systems i.e., Spectra Systems and Air Products go up and down completely randomly.
Pair Corralation between Spectra Systems and Air Products
If you would invest 29,597 in Air Products and on August 30, 2024 and sell it today you would earn a total of 3,725 from holding Air Products and or generate 12.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Spectra Systems vs. Air Products and
Performance |
| Timeline |
| Spectra Systems |
| Air Products |
Spectra Systems and Air Products Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spectra Systems and Air Products
The main advantage of trading using opposite Spectra Systems and Air Products positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spectra Systems position performs unexpectedly, Air Products 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 Air Products will offset losses from the drop in Air Products' long position.| Spectra Systems vs. Apple Inc | Spectra Systems vs. Microsoft | Spectra Systems vs. Alphabet Inc Class C | Spectra Systems vs. Meta Platforms |
| Air Products vs. PPG Industries | Air Products vs. Sherwin Williams Co | Air Products vs. Ecolab Inc | Air Products vs. Albemarle 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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