Correlation Between Mettler Toledo and CDW Corp

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

By analyzing existing cross correlation between Mettler Toledo International and CDW Corp, you can compare the effects of market volatilities on Mettler Toledo and CDW Corp 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 Mettler Toledo with a short position of CDW Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mettler Toledo and CDW Corp.

Diversification Opportunities for Mettler Toledo and CDW Corp

0.47

Correlation Coefficient

Mettler Toledo  CDW Corp

Very weak diversification

The 3 months correlation between Mettler and CDW is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Mettler Toledo International and CDW Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDW Corp and Mettler Toledo 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 Mettler Toledo International are associated (or correlated) with CDW Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDW Corp has no effect on the direction of Mettler Toledo i.e., Mettler Toledo and CDW Corp go up and down completely randomly.

Pair Corralation between Mettler Toledo and CDW Corp

Considering the 90-day investment horizon Mettler Toledo International is expected to generate 1.19 times more return on investment than CDW Corp. However, Mettler Toledo is 1.19 times more volatile than CDW Corp. It trades about 0.1 of its potential returns per unit of risk. CDW Corp is currently generating about 0.04 per unit of risk. If you would invest  106,337  in Mettler Toledo International on May 6, 2025 and sell it today you would earn a total of  14,350  from holding Mettler Toledo International or generate 13.49% return on investment over 90 days.

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

Mettler Toledo International  vs.  CDW Corp

Mettler Toledo Inter

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Mettler Toledo International are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Mettler Toledo exhibited solid returns over the last few months and may actually be approaching a breakup point.

CDW Corp

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in CDW Corp are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable fundamental indicators, CDW Corp is not utilizing all of its potentials. The newest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Mettler Toledo and CDW Corp

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

The idea behind Mettler Toledo International and CDW Corp 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.