Correlation Between Ingersoll Rand and Ampco Pittsburgh
Can any of the company-specific risk be diversified away by investing in both Ingersoll Rand and Ampco Pittsburgh 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 Ingersoll Rand and Ampco Pittsburgh into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ingersoll Rand and Ampco Pittsburgh, you can compare the effects of market volatilities on Ingersoll Rand and Ampco Pittsburgh 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 Ingersoll Rand with a short position of Ampco Pittsburgh. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ingersoll Rand and Ampco Pittsburgh.
Diversification Opportunities for Ingersoll Rand and Ampco Pittsburgh
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ingersoll and Ampco is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Ingersoll Rand and Ampco Pittsburgh in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ampco Pittsburgh and Ingersoll Rand 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 Ingersoll Rand are associated (or correlated) with Ampco Pittsburgh. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ampco Pittsburgh has no effect on the direction of Ingersoll Rand i.e., Ingersoll Rand and Ampco Pittsburgh go up and down completely randomly.
Pair Corralation between Ingersoll Rand and Ampco Pittsburgh
Allowing for the 90-day total investment horizon Ingersoll Rand is expected to generate 0.21 times more return on investment than Ampco Pittsburgh. However, Ingersoll Rand is 4.78 times less risky than Ampco Pittsburgh. It trades about -0.04 of its potential returns per unit of risk. Ampco Pittsburgh is currently generating about -0.06 per unit of risk. If you would invest 9,156 in Ingersoll Rand on January 19, 2024 and sell it today you would lose (105.00) from holding Ingersoll Rand or give up 1.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ingersoll Rand vs. Ampco Pittsburgh
Performance |
| Timeline |
| Ingersoll Rand |
| Ampco Pittsburgh |
Ingersoll Rand and Ampco Pittsburgh Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ingersoll Rand and Ampco Pittsburgh
The main advantage of trading using opposite Ingersoll Rand and Ampco Pittsburgh positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ingersoll Rand position performs unexpectedly, Ampco Pittsburgh 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 Ampco Pittsburgh will offset losses from the drop in Ampco Pittsburgh's long position.| Ingersoll Rand vs. Parker Hannifin | Ingersoll Rand vs. Emerson Electric | Ingersoll Rand vs. Smith AO | Ingersoll Rand vs. Franklin Electric Co |
| Ampco Pittsburgh vs. Northwest Pipe | Ampco Pittsburgh vs. Insteel Industries | Ampco Pittsburgh vs. Carpenter Technology | Ampco Pittsburgh vs. ESAB Corp |
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 CEOs Directory module to screen CEOs from public companies around the world.
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