Correlation Between Crawford and Cavco Industries

Can any of the company-specific risk be diversified away by investing in both Crawford and Cavco 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 Crawford and Cavco Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Crawford Company and Cavco Industries, you can compare the effects of market volatilities on Crawford and Cavco 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 Crawford with a short position of Cavco Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Crawford and Cavco Industries.

Diversification Opportunities for Crawford and Cavco Industries

0.23

Correlation Coefficient

Crawford  Cavco Industries

Modest diversification

The 3 months correlation between Crawford and Cavco is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Crawford Company and Cavco Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cavco Industries and Crawford 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 Crawford Company are associated (or correlated) with Cavco Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cavco Industries has no effect on the direction of Crawford i.e., Crawford and Cavco Industries go up and down completely randomly.

Pair Corralation between Crawford and Cavco Industries

Assuming the 90 days horizon Crawford Company is expected to generate 0.97 times more return on investment than Cavco Industries. However, Crawford Company is 1.03 times less risky than Cavco Industries. It trades about -0.08 of its potential returns per unit of risk. Cavco Industries is currently generating about -0.11 per unit of risk. If you would invest  1,070  in Crawford Company on May 7, 2025 and sell it today you would lose (123.00) from holding Crawford Company or give up 11.5% of portfolio value over 90 days.

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

Crawford Company  vs.  Cavco Industries

Crawford

Risk-Adjusted Performance

Weakest

Over the last 90 days Crawford Company has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Cavco Industries

Risk-Adjusted Performance

Weakest

Over the last 90 days Cavco Industries has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's fundamental indicators remain very healthy which may send shares a bit higher in September 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Crawford and Cavco Industries

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

The idea behind Crawford Company and Cavco Industries 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.