Correlation Between INGERSOLL and Intuitive Machines

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

By analyzing existing cross correlation between INGERSOLL RAND LUXEMBOURG FINANCE and Intuitive Machines, you can compare the effects of market volatilities on INGERSOLL and Intuitive Machines 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 INGERSOLL with a short position of Intuitive Machines. Check out your portfolio center. Please also check ongoing floating volatility patterns of INGERSOLL and Intuitive Machines.

Diversification Opportunities for INGERSOLL and Intuitive Machines

-0.44

Correlation Coefficient

INGERSOLL  Intuitive Machines

Very good diversification

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

Pair Corralation between INGERSOLL and Intuitive Machines

Assuming the 90 days trading horizon INGERSOLL RAND LUXEMBOURG FINANCE is expected to generate 3.1 times more return on investment than Intuitive Machines. However, INGERSOLL is 3.1 times more volatile than Intuitive Machines. It trades about 0.04 of its potential returns per unit of risk. Intuitive Machines is currently generating about 0.05 per unit of risk. If you would invest  9,226  in INGERSOLL RAND LUXEMBOURG FINANCE on September 20, 2024 and sell it today you would earn a total of  259.00  from holding INGERSOLL RAND LUXEMBOURG FINANCE or generate 2.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	92.34%
Values	Daily Returns

INGERSOLL RAND LUXEMBOURG FINA  vs.  Intuitive Machines

INGERSOLL RAND LUXEM

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days INGERSOLL RAND LUXEMBOURG FINANCE has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, INGERSOLL is not utilizing all of its potentials. The newest stock price disturbance, may contribute to short-term losses for the investors.

Intuitive Machines

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Intuitive Machines are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Intuitive Machines reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with INGERSOLL and Intuitive Machines

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

The idea behind INGERSOLL RAND LUXEMBOURG FINANCE and Intuitive Machines 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.

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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.