Correlation Between Schindler Holding and Ingersoll Rand
Can any of the company-specific risk be diversified away by investing in both Schindler Holding and Ingersoll Rand 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 Schindler Holding and Ingersoll Rand into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schindler Holding AG and Ingersoll Rand, you can compare the effects of market volatilities on Schindler Holding and Ingersoll Rand 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 Schindler Holding with a short position of Ingersoll Rand. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schindler Holding and Ingersoll Rand.
Diversification Opportunities for Schindler Holding and Ingersoll Rand
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Schindler and Ingersoll is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Schindler Holding AG and Ingersoll Rand in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ingersoll Rand and Schindler Holding 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 Schindler Holding AG are associated (or correlated) with Ingersoll Rand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ingersoll Rand has no effect on the direction of Schindler Holding i.e., Schindler Holding and Ingersoll Rand go up and down completely randomly.
Pair Corralation between Schindler Holding and Ingersoll Rand
Assuming the 90 days horizon Schindler Holding AG is expected to under-perform the Ingersoll Rand. But the pink sheet apears to be less risky and, when comparing its historical volatility, Schindler Holding AG is 3.43 times less risky than Ingersoll Rand. The pink sheet trades about -0.26 of its potential returns per unit of risk. The Ingersoll Rand is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 9,598 in Ingersoll Rand on September 1, 2024 and sell it today you would earn a total of 819.00 from holding Ingersoll Rand or generate 8.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Schindler Holding AG vs. Ingersoll Rand
Performance |
| Timeline |
| Schindler Holding |
| Ingersoll Rand |
Schindler Holding and Ingersoll Rand Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Schindler Holding and Ingersoll Rand
The main advantage of trading using opposite Schindler Holding and Ingersoll Rand positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schindler Holding position performs unexpectedly, Ingersoll Rand 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 Ingersoll Rand will offset losses from the drop in Ingersoll Rand's long position.| Schindler Holding vs. GE Aerospace | Schindler Holding vs. Eaton PLC | Schindler Holding vs. Siemens AG Class | Schindler Holding vs. Parker Hannifin |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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