Correlation Between Yokohama Rubber and BorgWarner
Can any of the company-specific risk be diversified away by investing in both Yokohama Rubber and BorgWarner 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 Yokohama Rubber and BorgWarner into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Yokohama Rubber and BorgWarner, you can compare the effects of market volatilities on Yokohama Rubber and BorgWarner 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 Yokohama Rubber with a short position of BorgWarner. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yokohama Rubber and BorgWarner.
Diversification Opportunities for Yokohama Rubber and BorgWarner
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Yokohama and BorgWarner is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding The Yokohama Rubber and BorgWarner in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BorgWarner and Yokohama Rubber 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 The Yokohama Rubber are associated (or correlated) with BorgWarner. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BorgWarner has no effect on the direction of Yokohama Rubber i.e., Yokohama Rubber and BorgWarner go up and down completely randomly.
Pair Corralation between Yokohama Rubber and BorgWarner
If you would invest 3,345 in BorgWarner on September 3, 2024 and sell it today you would earn a total of 87.00 from holding BorgWarner or generate 2.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 5.0% |
| Values | Daily Returns |
The Yokohama Rubber vs. BorgWarner
Performance |
| Timeline |
| Yokohama Rubber |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| BorgWarner |
Yokohama Rubber and BorgWarner Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yokohama Rubber and BorgWarner
The main advantage of trading using opposite Yokohama Rubber and BorgWarner positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yokohama Rubber position performs unexpectedly, BorgWarner 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 BorgWarner will offset losses from the drop in BorgWarner's long position.| Yokohama Rubber vs. BorgWarner | Yokohama Rubber vs. American Axle Manufacturing | Yokohama Rubber vs. Magna International | Yokohama Rubber vs. Dana Inc |
| BorgWarner vs. Allison Transmission Holdings | BorgWarner vs. Aptiv PLC | BorgWarner vs. LKQ Corporation | BorgWarner vs. Lear Corporation |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments |