Correlation Between Pentair Plc and BOS BETTER

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

By analyzing existing cross correlation between Pentair plc and BOS BETTER ONLINE, you can compare the effects of market volatilities on Pentair Plc and BOS BETTER 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 Pentair Plc with a short position of BOS BETTER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pentair Plc and BOS BETTER.

Diversification Opportunities for Pentair Plc and BOS BETTER

0.0

Correlation Coefficient

Pentair Plc  BOS BETTER

Pay attention - limited upside

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

Pair Corralation between Pentair Plc and BOS BETTER

If you would invest  236.00  in BOS BETTER ONLINE on October 10, 2024 and sell it today you would earn a total of  0.00  from holding BOS BETTER ONLINE or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Pentair plc  vs.  BOS BETTER ONLINE

Pentair plc

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Pentair plc are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Pentair Plc may actually be approaching a critical reversion point that can send shares even higher in February 2025.

BOS BETTER ONLINE

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days BOS BETTER ONLINE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, BOS BETTER is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Pentair Plc and BOS BETTER

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

The idea behind Pentair plc and BOS BETTER ONLINE 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.