Correlation Between Spirax-Sarco Engineering and Chart Industries
Can any of the company-specific risk be diversified away by investing in both Spirax-Sarco Engineering and Chart Industries 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 Spirax-Sarco Engineering and Chart Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Spirax Sarco Engineering PLC and Chart Industries, you can compare the effects of market volatilities on Spirax-Sarco Engineering and Chart Industries 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 Spirax-Sarco Engineering with a short position of Chart Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Spirax-Sarco Engineering and Chart Industries.
Diversification Opportunities for Spirax-Sarco Engineering and Chart Industries
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Spirax-Sarco and Chart is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Spirax Sarco Engineering PLC and Chart Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chart Industries and Spirax-Sarco Engineering 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 Spirax Sarco Engineering PLC are associated (or correlated) with Chart Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chart Industries has no effect on the direction of Spirax-Sarco Engineering i.e., Spirax-Sarco Engineering and Chart Industries go up and down completely randomly.
Pair Corralation between Spirax-Sarco Engineering and Chart Industries
Assuming the 90 days horizon Spirax Sarco Engineering PLC is expected to under-perform the Chart Industries. But the pink sheet apears to be less risky and, when comparing its historical volatility, Spirax Sarco Engineering PLC is 1.59 times less risky than Chart Industries. The pink sheet trades about -0.09 of its potential returns per unit of risk. The Chart Industries is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 13,633 in Chart Industries on August 25, 2024 and sell it today you would earn a total of 4,747 from holding Chart Industries or generate 34.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 94.76% |
| Values | Daily Returns |
Spirax Sarco Engineering PLC vs. Chart Industries
Performance |
| Timeline |
| Spirax-Sarco Engineering |
| Chart Industries |
Spirax-Sarco Engineering and Chart Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Spirax-Sarco Engineering and Chart Industries
The main advantage of trading using opposite Spirax-Sarco Engineering and Chart Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Spirax-Sarco Engineering position performs unexpectedly, Chart Industries 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 Chart Industries will offset losses from the drop in Chart Industries' long position.| Spirax-Sarco Engineering vs. Aumann AG | Spirax-Sarco Engineering vs. Arista Power | Spirax-Sarco Engineering vs. Atlas Copco AB | Spirax-Sarco Engineering vs. American Commerce Solutions |
| Chart Industries vs. Crane NXT Co | Chart Industries vs. Donaldson | Chart Industries vs. ITT Inc | Chart Industries vs. Franklin Electric Co |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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