Correlation Between Raytheon Technologies and Trinity Industries
Can any of the company-specific risk be diversified away by investing in both Raytheon Technologies and Trinity Industries 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 Raytheon Technologies and Trinity Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Raytheon Technologies and Trinity Industries, you can compare the effects of market volatilities on Raytheon Technologies and Trinity Industries 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 Raytheon Technologies with a short position of Trinity Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Raytheon Technologies and Trinity Industries.
Diversification Opportunities for Raytheon Technologies and Trinity Industries
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Raytheon and Trinity is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Raytheon Technologies and Trinity Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trinity Industries and Raytheon Technologies 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 Raytheon Technologies are associated (or correlated) with Trinity Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trinity Industries has no effect on the direction of Raytheon Technologies i.e., Raytheon Technologies and Trinity Industries go up and down completely randomly.
Pair Corralation between Raytheon Technologies and Trinity Industries
If you would invest 2,551 in Trinity Industries on January 19, 2024 and sell it today you would earn a total of 38.00 from holding Trinity Industries or generate 1.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Raytheon Technologies vs. Trinity Industries
Performance |
| Timeline |
| Raytheon Technologies |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Trinity Industries |
Raytheon Technologies and Trinity Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Raytheon Technologies and Trinity Industries
The main advantage of trading using opposite Raytheon Technologies and Trinity Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Raytheon Technologies position performs unexpectedly, Trinity Industries 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 Trinity Industries will offset losses from the drop in Trinity Industries' long position.| Raytheon Technologies vs. Continental Beverage Brands | Raytheon Technologies vs. Fevertree Drinks Plc | Raytheon Technologies vs. Fomento Economico Mexicano | Raytheon Technologies vs. Premium Beverage Group |
| Trinity Industries vs. LB Foster | Trinity Industries vs. CSX Corporation | Trinity Industries vs. Norfolk Southern | Trinity Industries vs. Union Pacific |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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