Correlation Between Modine Manufacturing and Webull Incentive

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

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

Diversification Opportunities for Modine Manufacturing and Webull Incentive

-0.55

Correlation Coefficient

Modine Manufacturing  Webull Incentive

Excellent diversification

The 3 months correlation between Modine and Webull is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Modine Manufacturing and Webull Incentive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Webull Incentive and Modine Manufacturing 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 Modine Manufacturing are associated (or correlated) with Webull Incentive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Webull Incentive has no effect on the direction of Modine Manufacturing i.e., Modine Manufacturing and Webull Incentive go up and down completely randomly.

Pair Corralation between Modine Manufacturing and Webull Incentive

Considering the 90-day investment horizon Modine Manufacturing is expected to generate 11.7 times less return on investment than Webull Incentive. But when comparing it to its historical volatility, Modine Manufacturing is 11.59 times less risky than Webull Incentive. It trades about 0.13 of its potential returns per unit of risk. Webull Incentive is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  219.00  in Webull Incentive on May 20, 2025 and sell it today you would lose (32.00) from holding Webull Incentive or give up 14.61% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	46.77%
Values	Daily Returns

Modine Manufacturing  vs.  Webull Incentive

Modine Manufacturing

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Modine Manufacturing are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Modine Manufacturing exhibited solid returns over the last few months and may actually be approaching a breakup point.

Webull Incentive

Risk-Adjusted Performance

Fair

Over the last 90 days Webull Incentive has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly conflicting essential indicators, Webull Incentive showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Modine Manufacturing and Webull Incentive

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

The idea behind Modine Manufacturing and Webull Incentive 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.