Correlation Between Shimmick Common and Argan
Can any of the company-specific risk be diversified away by investing in both Shimmick Common and Argan 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 Shimmick Common and Argan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shimmick Common and Argan Inc, you can compare the effects of market volatilities on Shimmick Common and Argan 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 Shimmick Common with a short position of Argan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shimmick Common and Argan.
Diversification Opportunities for Shimmick Common and Argan
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Shimmick and Argan is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Shimmick Common and Argan Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Argan Inc and Shimmick Common 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 Shimmick Common are associated (or correlated) with Argan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Argan Inc has no effect on the direction of Shimmick Common i.e., Shimmick Common and Argan go up and down completely randomly.
Pair Corralation between Shimmick Common and Argan
Given the investment horizon of 90 days Shimmick Common is expected to generate 1.0 times less return on investment than Argan. In addition to that, Shimmick Common is 1.21 times more volatile than Argan Inc. It trades about 0.14 of its total potential returns per unit of risk. Argan Inc is currently generating about 0.17 per unit of volatility. If you would invest 13,614 in Argan Inc on August 31, 2024 and sell it today you would earn a total of 1,891 from holding Argan Inc or generate 13.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shimmick Common vs. Argan Inc
Performance |
| Timeline |
| Shimmick Common |
| Argan Inc |
Shimmick Common and Argan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shimmick Common and Argan
The main advantage of trading using opposite Shimmick Common and Argan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shimmick Common position performs unexpectedly, Argan 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 Argan will offset losses from the drop in Argan's long position.| Shimmick Common vs. EMCOR Group | Shimmick Common vs. MYR Group | Shimmick Common vs. Topbuild Corp | Shimmick Common vs. Api Group Corp |
| Argan vs. Arcosa Inc | Argan vs. Construction Partners | Argan vs. Topbuild Corp | Argan vs. Comfort Systems USA |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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