Correlation Between Trane Technologies and ScanTech

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

By analyzing existing cross correlation between Trane Technologies plc and ScanTech AI Systems, you can compare the effects of market volatilities on Trane Technologies and ScanTech 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 Trane Technologies with a short position of ScanTech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Trane Technologies and ScanTech.

Diversification Opportunities for Trane Technologies and ScanTech

-0.51

Correlation Coefficient

Trane Technologies  ScanTech

Excellent diversification

The 3 months correlation between Trane and ScanTech is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Trane Technologies plc and ScanTech AI Systems in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ScanTech AI Systems and Trane 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 Trane Technologies plc are associated (or correlated) with ScanTech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ScanTech AI Systems has no effect on the direction of Trane Technologies i.e., Trane Technologies and ScanTech go up and down completely randomly.

Pair Corralation between Trane Technologies and ScanTech

Allowing for the 90-day total investment horizon Trane Technologies plc is expected to generate 0.12 times more return on investment than ScanTech. However, Trane Technologies plc is 8.31 times less risky than ScanTech. It trades about 0.04 of its potential returns per unit of risk. ScanTech AI Systems is currently generating about -0.06 per unit of risk. If you would invest  41,524  in Trane Technologies plc on May 12, 2025 and sell it today you would earn a total of  1,485  from holding Trane Technologies plc or generate 3.58% return on investment over 90 days.

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

Trane Technologies plc  vs.  ScanTech AI Systems

Trane Technologies plc

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Trane Technologies plc are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Trane Technologies is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

ScanTech AI Systems

Risk-Adjusted Performance

Weakest

Over the last 90 days ScanTech AI Systems has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in September 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Trane Technologies and ScanTech

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

The idea behind Trane Technologies plc and ScanTech AI Systems 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.