Correlation Between Hillenbrand and CIRCOR International

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

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

Diversification Opportunities for Hillenbrand and CIRCOR International

0.0

Correlation Coefficient

Hillenbrand  CIRCOR International

Pay attention - limited upside

The 3 months correlation between Hillenbrand and CIRCOR is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Hillenbrand and CIRCOR International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIRCOR International and Hillenbrand 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 Hillenbrand are associated (or correlated) with CIRCOR International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIRCOR International has no effect on the direction of Hillenbrand i.e., Hillenbrand and CIRCOR International go up and down completely randomly.

Pair Corralation between Hillenbrand and CIRCOR International

If you would invest (100.00) in CIRCOR International on December 1, 2024 and sell it today you would earn a total of  100.00  from holding CIRCOR International or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Hillenbrand  vs.  CIRCOR International

Hillenbrand

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hillenbrand 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 forward indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

CIRCOR International

Risk-Adjusted Performance

Very Weak

Over the last 90 days CIRCOR International has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable forward indicators, CIRCOR International is not utilizing all of its potentials. The recent stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Hillenbrand and CIRCOR International

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

The idea behind Hillenbrand and CIRCOR International 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.