Correlation Between 00108WAF7 and TEXTRON
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By analyzing existing cross correlation between AEP TEX INC and TEXTRON INC 4, you can compare the effects of market volatilities on 00108WAF7 and TEXTRON 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 00108WAF7 with a short position of TEXTRON. Check out your portfolio center. Please also check ongoing floating volatility patterns of 00108WAF7 and TEXTRON.
Diversification Opportunities for 00108WAF7 and TEXTRON
Significant diversification
The 3 months correlation between 00108WAF7 and TEXTRON is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding AEP TEX INC and TEXTRON INC 4 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TEXTRON INC 4 and 00108WAF7 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 AEP TEX INC are associated (or correlated) with TEXTRON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TEXTRON INC 4 has no effect on the direction of 00108WAF7 i.e., 00108WAF7 and TEXTRON go up and down completely randomly.
Pair Corralation between 00108WAF7 and TEXTRON
Assuming the 90 days trading horizon AEP TEX INC is expected to generate 12.57 times more return on investment than TEXTRON. However, 00108WAF7 is 12.57 times more volatile than TEXTRON INC 4. It trades about 0.04 of its potential returns per unit of risk. TEXTRON INC 4 is currently generating about -0.2 per unit of risk. If you would invest 7,599 in AEP TEX INC on October 9, 2024 and sell it today you would earn a total of 69.00 from holding AEP TEX INC or generate 0.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 66.67% |
| Values | Daily Returns |
AEP TEX INC vs. TEXTRON INC 4
Performance |
| Timeline |
| AEP TEX INC |
| TEXTRON INC 4 |
00108WAF7 and TEXTRON Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 00108WAF7 and TEXTRON
The main advantage of trading using opposite 00108WAF7 and TEXTRON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 00108WAF7 position performs unexpectedly, TEXTRON 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 TEXTRON will offset losses from the drop in TEXTRON's long position.| 00108WAF7 vs. LENSAR Inc | 00108WAF7 vs. National Vision Holdings | 00108WAF7 vs. Merit Medical Systems | 00108WAF7 vs. Xtant Medical Holdings |
| TEXTRON vs. Viemed Healthcare | TEXTRON vs. Merit Medical Systems | TEXTRON vs. Sonida Senior Living | TEXTRON vs. Siriuspoint |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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