Correlation Between Honeywell International and Intel
Can any of the company-specific risk be diversified away by investing in both Honeywell International and Intel 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 Honeywell International and Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Honeywell International and Intel, you can compare the effects of market volatilities on Honeywell International and Intel 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 International with a short position of Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Honeywell International and Intel.
Diversification Opportunities for Honeywell International and Intel
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Honeywell and Intel is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Honeywell International and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel and Honeywell International 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 International are associated (or correlated) with Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of Honeywell International i.e., Honeywell International and Intel go up and down completely randomly.
Pair Corralation between Honeywell International and Intel
Assuming the 90 days trading horizon Honeywell International is expected to generate 0.52 times more return on investment than Intel. However, Honeywell International is 1.93 times less risky than Intel. It trades about -0.1 of its potential returns per unit of risk. Intel is currently generating about -0.34 per unit of risk. If you would invest 335,100 in Honeywell International on January 26, 2024 and sell it today you would lose (9,479) from holding Honeywell International or give up 2.83% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 95.24% |
Values | Daily Returns |
Honeywell International vs. Intel
Performance |
Timeline |
Honeywell International |
Intel |
Honeywell International and Intel Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Honeywell International and Intel
The main advantage of trading using opposite Honeywell International and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Honeywell International position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.Honeywell International vs. Burlington Stores | Honeywell International vs. Verizon Communications | Honeywell International vs. Prudential Financial | Honeywell International vs. Ameriprise Financial |
Intel vs. NVIDIA | Intel vs. Taiwan Semiconductor Manufacturing | Intel vs. Marvell Technology Group | Intel vs. Micron Technology |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
FinTech Suite Use AI to screen and filter profitable investment opportunities | |
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals |