Correlation Between HubSpot and Curtiss Wright

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

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

Diversification Opportunities for HubSpot and Curtiss Wright

0.44

Correlation Coefficient

HubSpot  Curtiss Wright

Very weak diversification

The 3 months correlation between HubSpot and Curtiss is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding HubSpot and Curtiss Wright in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Curtiss Wright and HubSpot 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 HubSpot are associated (or correlated) with Curtiss Wright. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Curtiss Wright has no effect on the direction of HubSpot i.e., HubSpot and Curtiss Wright go up and down completely randomly.

Pair Corralation between HubSpot and Curtiss Wright

Given the investment horizon of 90 days HubSpot is expected to generate 1.07 times more return on investment than Curtiss Wright. However, HubSpot is 1.07 times more volatile than Curtiss Wright. It trades about 0.23 of its potential returns per unit of risk. Curtiss Wright is currently generating about 0.02 per unit of risk. If you would invest  53,292  in HubSpot on October 20, 2024 and sell it today you would earn a total of  17,152  from holding HubSpot or generate 32.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.39%
Values	Daily Returns

HubSpot  vs.  Curtiss Wright

HubSpot

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in HubSpot are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively abnormal fundamental drivers, HubSpot unveiled solid returns over the last few months and may actually be approaching a breakup point.

Curtiss Wright

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Curtiss Wright are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Curtiss Wright is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with HubSpot and Curtiss Wright

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

The idea behind HubSpot and Curtiss Wright 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.