Correlation Between Curtiss Wright and Thermo Fisher
Can any of the company-specific risk be diversified away by investing in both Curtiss Wright and Thermo Fisher 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 Curtiss Wright and Thermo Fisher into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Curtiss Wright and Thermo Fisher Scientific, you can compare the effects of market volatilities on Curtiss Wright and Thermo Fisher 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 Curtiss Wright with a short position of Thermo Fisher. Check out your portfolio center. Please also check ongoing floating volatility patterns of Curtiss Wright and Thermo Fisher.
Diversification Opportunities for Curtiss Wright and Thermo Fisher
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Curtiss and Thermo is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Curtiss-Wright and Thermo Fisher Scientific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thermo Fisher Scientific and Curtiss Wright 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 Curtiss Wright are associated (or correlated) with Thermo Fisher. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thermo Fisher Scientific has no effect on the direction of Curtiss Wright i.e., Curtiss Wright and Thermo Fisher go up and down completely randomly.
Pair Corralation between Curtiss Wright and Thermo Fisher
Allowing for the 90-day total investment horizon Curtiss Wright is expected to generate 0.83 times more return on investment than Thermo Fisher. However, Curtiss Wright is 1.21 times less risky than Thermo Fisher. It trades about 0.45 of its potential returns per unit of risk. Thermo Fisher Scientific is currently generating about 0.13 per unit of risk. If you would invest 23,603 in Curtiss Wright on December 29, 2023 and sell it today you would earn a total of 1,754 from holding Curtiss Wright or generate 7.43% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Curtiss-Wright vs. Thermo Fisher Scientific
Performance |
Timeline |
Curtiss-Wright |
Thermo Fisher Scientific |
Curtiss Wright and Thermo Fisher Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Curtiss Wright and Thermo Fisher
The main advantage of trading using opposite Curtiss Wright and Thermo Fisher positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Curtiss Wright position performs unexpectedly, Thermo Fisher 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 Thermo Fisher will offset losses from the drop in Thermo Fisher's long position.Curtiss Wright vs. A2Z Smart Technologies | Curtiss Wright vs. Planet Labs PBC | Curtiss Wright vs. Draganfly | Curtiss Wright vs. Momentus |
Thermo Fisher vs. Mustang Bio | Thermo Fisher vs. Moleculin Biotech | Thermo Fisher vs. Clever Leaves Holdings | Thermo Fisher vs. Seres Therapeutics |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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