Illinois Tool Correlations

ITW Stock

USD 251.34 2.02 0.80%

The current 90-days correlation between Illinois Tool Works and Parker Hannifin is 0.47 (i.e., Very weak diversification). The correlation of Illinois Tool is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak. If the correlation is 0, the equities are not correlated; they are entirely random.

Illinois Tool Correlation With Market

Very weak diversification

The correlation between Illinois Tool Works and DJI is 0.52 (i.e., Very weak diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Illinois Tool Works and DJI in the same portfolio, assuming nothing else is changed.

Check out Risk vs Return Analysis to better understand how to build diversified portfolios, which includes a position in Illinois Tool Works. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in estimate.

Moving together with Illinois Stock

0.77	EPAC	Enerpac Tool Group	Pair Corr
0.82	FELE	Franklin Electric	Pair Corr
0.73	AME	Ametek Inc	Pair Corr
0.62	DCI	Donaldson	Pair Corr
0.88	GGG	Graco Inc	Pair Corr
0.7	GRC	Gorman Rupp	Pair Corr
0.66	KAI	Kadant Inc	Pair Corr

Moving against Illinois Stock

0.44	RR	Richtech Robotics Class	Pair Corr
0.33	CVV	CVD Equipment Earnings Call This Week	Pair Corr

Related Correlations Analysis

	PNR	PH	EMR	AOS	DOV	CMI	ETN	IR	XYL	FELE
PNR		0.59	0.9	0.54	0.54	0.59	0.85	0.93	-0.36	-0.1	PNR
PH	0.59		0.8	-0.02	0.97	0.82	0.28	0.54	0.43	0.44	PH
EMR	0.9	0.8		0.35	0.78	0.7	0.65	0.85	0.0	0.18	EMR
AOS	0.54	-0.02	0.35		-0.07	0.07	0.64	0.52	-0.52	-0.1	AOS
DOV	0.54	0.97	0.78	-0.07		0.84	0.21	0.5	0.51	0.54	DOV
CMI	0.59	0.82	0.7	0.07	0.84		0.39	0.49	0.34	0.39	CMI
ETN	0.85	0.28	0.65	0.64	0.21	0.39		0.81	-0.62	-0.34	ETN
IR	0.93	0.54	0.85	0.52	0.5	0.49	0.81		-0.28	-0.04	IR
XYL	-0.36	0.43	0.0	-0.52	0.51	0.34	-0.62	-0.28		0.72	XYL
FELE	-0.1	0.44	0.18	-0.1	0.54	0.39	-0.34	-0.04	0.72		FELE
	PNR	PH	EMR	AOS	DOV	CMI	ETN	IR	XYL	FELE

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Correlation Matchups

Over a given time period, the two securities move together when the Correlation Coefficient is positive. Conversely, the two assets move in opposite directions when the Correlation Coefficient is negative. Determining your positions' relationship to each other is valuable for analyzing and projecting your portfolio's future expected return and risk.

High positive correlations

DOV	+ 0.97	PH
IR	+ 0.93	PNR
EMR	+ 0.9	PNR
ETN	+ 0.85	PNR
IR	+ 0.85	EMR
CMI	+ 0.84	DOV

High negative correlations

XYL	- 0.62	ETN
XYL	- 0.52	AOS
XYL	- 0.36	PNR
FELE	- 0.34	ETN
XYL	- 0.28	IR
FELE	- 0.1	AOS

Risk-Adjusted Indicators

There is a big difference between Illinois Stock performing well and Illinois Tool Company doing well as a business compared to the competition. There are so many exceptions to the norm that investors cannot definitively determine what's good or bad unless they analyze Illinois Tool's multiple risk-adjusted performance indicators across the competitive landscape. These indicators are quantitative in nature and help investors forecast volatility and risk-adjusted expected returns across various positions.

	Mean Deviation	Jensen Alpha	Treynor Ratio	Potential Upside	Value @Risk	Maximum Drawdown
PNR	1.10	(0.24)	(0.30)	1.78	(2.61)	6.53
PH	1.27	(0.02)	(0.08)	2.27	(3.50)	10.15
EMR	1.26	(0.12)	(0.17)	2.13	(2.68)	9.68
AOS	1.05	(0.08)	(0.21)	2.14	(2.36)	7.41
DOV	1.13	(0.08)	(0.14)	1.96	(2.85)	8.86
CMI	1.25	(0.12)	(0.19)	1.83	(3.32)	9.77
ETN	1.69	(0.18)	(0.26)	3.41	(3.54)	19.37
IR	1.30	(0.25)	(0.29)	2.34	(2.57)	10.46
XYL	0.94	0.03	(0.03)	1.85	(1.84)	8.85
FELE	1.06	(0.08)	(0.17)	2.00	(2.17)	8.22

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