Correlation Between Orion Group and Tutor Perini

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

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

Diversification Opportunities for Orion Group and Tutor Perini

0.36

Correlation Coefficient

Orion Group  Tutor Perini

Weak diversification

The 3 months correlation between Orion and Tutor is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Orion Group Holdings and Tutor Perini in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tutor Perini and Orion Group 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 Orion Group Holdings are associated (or correlated) with Tutor Perini. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tutor Perini has no effect on the direction of Orion Group i.e., Orion Group and Tutor Perini go up and down completely randomly.

Pair Corralation between Orion Group and Tutor Perini

Considering the 90-day investment horizon Orion Group Holdings is expected to generate 1.11 times more return on investment than Tutor Perini. However, Orion Group is 1.11 times more volatile than Tutor Perini. It trades about 0.08 of its potential returns per unit of risk. Tutor Perini is currently generating about 0.09 per unit of risk. If you would invest  239.00  in Orion Group Holdings on September 2, 2024 and sell it today you would earn a total of  633.00  from holding Orion Group Holdings or generate 264.85% return on investment over 90 days.

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

Orion Group Holdings  vs.  Tutor Perini

Orion Group Holdings

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Orion Group Holdings are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile basic indicators, Orion Group displayed solid returns over the last few months and may actually be approaching a breakup point.

Tutor Perini

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Tutor Perini are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Tutor Perini exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Orion Group and Tutor Perini

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

The idea behind Orion Group Holdings and Tutor Perini 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.