Correlation Between Hillenbrand and Rockwell Automation
Can any of the company-specific risk be diversified away by investing in both Hillenbrand and Rockwell Automation 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 Rockwell Automation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hillenbrand and Rockwell Automation, you can compare the effects of market volatilities on Hillenbrand and Rockwell Automation 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 Rockwell Automation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hillenbrand and Rockwell Automation.
Diversification Opportunities for Hillenbrand and Rockwell Automation
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hillenbrand and Rockwell is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Hillenbrand and Rockwell Automation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rockwell Automation 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 Rockwell Automation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rockwell Automation has no effect on the direction of Hillenbrand i.e., Hillenbrand and Rockwell Automation go up and down completely randomly.
Pair Corralation between Hillenbrand and Rockwell Automation
Allowing for the 90-day total investment horizon Hillenbrand is expected to generate 1.54 times more return on investment than Rockwell Automation. However, Hillenbrand is 1.54 times more volatile than Rockwell Automation. It trades about 0.07 of its potential returns per unit of risk. Rockwell Automation is currently generating about 0.1 per unit of risk. If you would invest 2,744 in Hillenbrand on September 18, 2024 and sell it today you would earn a total of 334.00 from holding Hillenbrand or generate 12.17% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Hillenbrand vs. Rockwell Automation
Performance |
Timeline |
Hillenbrand |
Rockwell Automation |
Hillenbrand and Rockwell Automation Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hillenbrand and Rockwell Automation
The main advantage of trading using opposite Hillenbrand and Rockwell Automation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hillenbrand position performs unexpectedly, Rockwell Automation 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 Rockwell Automation will offset losses from the drop in Rockwell Automation's long position.Hillenbrand vs. IDEX Corporation | Hillenbrand vs. Watts Water Technologies | Hillenbrand vs. Donaldson | Hillenbrand vs. Gorman Rupp |
Rockwell Automation vs. Barnes Group | Rockwell Automation vs. Babcock Wilcox Enterprises | Rockwell Automation vs. Crane Company | Rockwell Automation vs. Hillenbrand |
Check out your portfolio center.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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
Other Complementary Tools
Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
Bonds Directory Find actively traded corporate debentures issued by US companies | |
Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities |