Correlation Between Timken and 059438AH4
Specify exactly 2 symbols:
By analyzing existing cross correlation between Timken Company and BANC ONE P, you can compare the effects of market volatilities on Timken and 059438AH4 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 Timken with a short position of 059438AH4. Check out your portfolio center. Please also check ongoing floating volatility patterns of Timken and 059438AH4.
Diversification Opportunities for Timken and 059438AH4
Significant diversification
The 3 months correlation between Timken and 059438AH4 is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Timken Company and BANC ONE P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BANC ONE P and Timken 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 Timken Company are associated (or correlated) with 059438AH4. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BANC ONE P has no effect on the direction of Timken i.e., Timken and 059438AH4 go up and down completely randomly.
Pair Corralation between Timken and 059438AH4
Considering the 90-day investment horizon Timken Company is expected to generate 4.71 times more return on investment than 059438AH4. However, Timken is 4.71 times more volatile than BANC ONE P. It trades about 0.14 of its potential returns per unit of risk. BANC ONE P is currently generating about 0.19 per unit of risk. If you would invest 7,629 in Timken Company on November 29, 2024 and sell it today you would earn a total of 387.00 from holding Timken Company or generate 5.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Timken Company vs. BANC ONE P
Performance |
| Timeline |
| Timken Company |
| BANC ONE P |
Timken and 059438AH4 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Timken and 059438AH4
The main advantage of trading using opposite Timken and 059438AH4 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Timken position performs unexpectedly, 059438AH4 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 059438AH4 will offset losses from the drop in 059438AH4's long position.The idea behind Timken Company and BANC ONE P pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| 059438AH4 vs. AEP TEX INC | 059438AH4 vs. iShares Global Consumer | 059438AH4 vs. Caterpillar | 059438AH4 vs. 3M Company |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |