Correlation Between Core Molding and 5E Advanced

Can any of the company-specific risk be diversified away by investing in both Core Molding and 5E Advanced 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 Core Molding and 5E Advanced into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Core Molding Technologies and 5E Advanced Materials, you can compare the effects of market volatilities on Core Molding and 5E Advanced 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 Core Molding with a short position of 5E Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Core Molding and 5E Advanced.

Diversification Opportunities for Core Molding and 5E Advanced

-0.41

Correlation Coefficient

Core Molding  5E Advanced

Very good diversification

The 3 months correlation between Core and FEAM is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Core Molding Technologies and 5E Advanced Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 5E Advanced Materials and Core Molding 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 Core Molding Technologies are associated (or correlated) with 5E Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 5E Advanced Materials has no effect on the direction of Core Molding i.e., Core Molding and 5E Advanced go up and down completely randomly.

Pair Corralation between Core Molding and 5E Advanced

Considering the 90-day investment horizon Core Molding is expected to generate 2.43 times less return on investment than 5E Advanced. But when comparing it to its historical volatility, Core Molding Technologies is 4.55 times less risky than 5E Advanced. It trades about 0.1 of its potential returns per unit of risk. 5E Advanced Materials is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  425.00  in 5E Advanced Materials on May 16, 2025 and sell it today you would earn a total of  39.00  from holding 5E Advanced Materials or generate 9.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Core Molding Technologies  vs.  5E Advanced Materials

Core Molding Technologies

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Core Molding Technologies are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak primary indicators, Core Molding may actually be approaching a critical reversion point that can send shares even higher in September 2025.

5E Advanced Materials

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in 5E Advanced Materials are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very weak basic indicators, 5E Advanced displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Core Molding and 5E Advanced

The main advantage of trading using opposite Core Molding and 5E Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Core Molding position performs unexpectedly, 5E Advanced 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 5E Advanced will offset losses from the drop in 5E Advanced's long position.

The idea behind Core Molding Technologies and 5E Advanced Materials pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.