Correlation Between INGERSOLL and Kura Sushi

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

By analyzing existing cross correlation between INGERSOLL RAND GLOBAL HLDG and Kura Sushi USA, you can compare the effects of market volatilities on INGERSOLL and Kura Sushi 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 Kura Sushi. Check out your portfolio center. Please also check ongoing floating volatility patterns of INGERSOLL and Kura Sushi.

Diversification Opportunities for INGERSOLL and Kura Sushi

-0.72

Correlation Coefficient

INGERSOLL  Kura Sushi

Pay attention - limited upside

The 3 months correlation between INGERSOLL and Kura is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding INGERSOLL RAND GLOBAL HLDG and Kura Sushi USA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kura Sushi USA 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 GLOBAL HLDG are associated (or correlated) with Kura Sushi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kura Sushi USA has no effect on the direction of INGERSOLL i.e., INGERSOLL and Kura Sushi go up and down completely randomly.

Pair Corralation between INGERSOLL and Kura Sushi

Assuming the 90 days trading horizon INGERSOLL RAND GLOBAL HLDG is expected to under-perform the Kura Sushi. But the bond apears to be less risky and, when comparing its historical volatility, INGERSOLL RAND GLOBAL HLDG is 12.26 times less risky than Kura Sushi. The bond trades about -0.13 of its potential returns per unit of risk. The Kura Sushi USA is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  8,581  in Kura Sushi USA on September 19, 2024 and sell it today you would earn a total of  1,224  from holding Kura Sushi USA or generate 14.26% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	95.24%
Values	Daily Returns

INGERSOLL RAND GLOBAL HLDG  vs.  Kura Sushi USA

INGERSOLL RAND GLOBAL

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days INGERSOLL RAND GLOBAL HLDG 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 current stock price disturbance, may contribute to short-term losses for the investors.

Kura Sushi USA

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kura Sushi USA are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Kura Sushi unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with INGERSOLL and Kura Sushi

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

The idea behind INGERSOLL RAND GLOBAL HLDG and Kura Sushi USA 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.