Correlation Between HONEYWELL and Avient Corp
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By analyzing existing cross correlation between HONEYWELL INTL INC and Avient Corp, you can compare the effects of market volatilities on HONEYWELL and Avient Corp 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 HONEYWELL with a short position of Avient Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of HONEYWELL and Avient Corp.
Diversification Opportunities for HONEYWELL and Avient Corp
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between HONEYWELL and Avient is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding HONEYWELL INTL INC and Avient Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avient Corp and HONEYWELL 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 HONEYWELL INTL INC are associated (or correlated) with Avient Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avient Corp has no effect on the direction of HONEYWELL i.e., HONEYWELL and Avient Corp go up and down completely randomly.
Pair Corralation between HONEYWELL and Avient Corp
Assuming the 90 days trading horizon HONEYWELL INTL INC is expected to under-perform the Avient Corp. But the bond apears to be less risky and, when comparing its historical volatility, HONEYWELL INTL INC is 1.88 times less risky than Avient Corp. The bond trades about -0.1 of its potential returns per unit of risk. The Avient Corp is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 4,614 in Avient Corp on September 2, 2024 and sell it today you would earn a total of 511.00 from holding Avient Corp or generate 11.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 85.71% |
| Values | Daily Returns |
HONEYWELL INTL INC vs. Avient Corp
Performance |
| Timeline |
| HONEYWELL INTL INC |
| Avient Corp |
HONEYWELL and Avient Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HONEYWELL and Avient Corp
The main advantage of trading using opposite HONEYWELL and Avient Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HONEYWELL position performs unexpectedly, Avient Corp 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 Avient Corp will offset losses from the drop in Avient Corp's long position.| HONEYWELL vs. Avient Corp | HONEYWELL vs. Flexible Solutions International | HONEYWELL vs. Harmony Gold Mining | HONEYWELL vs. Consol Energy |
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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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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