Correlation Between Westinghouse Air and MCKESSON
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By analyzing existing cross correlation between Westinghouse Air Brake and MCKESSON P NEW, you can compare the effects of market volatilities on Westinghouse Air and MCKESSON 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 Westinghouse Air with a short position of MCKESSON. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westinghouse Air and MCKESSON.
Diversification Opportunities for Westinghouse Air and MCKESSON
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Westinghouse and MCKESSON is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Westinghouse Air Brake and MCKESSON P NEW in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MCKESSON P NEW and Westinghouse Air 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 Westinghouse Air Brake are associated (or correlated) with MCKESSON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MCKESSON P NEW has no effect on the direction of Westinghouse Air i.e., Westinghouse Air and MCKESSON go up and down completely randomly.
Pair Corralation between Westinghouse Air and MCKESSON
Considering the 90-day investment horizon Westinghouse Air Brake is expected to generate 5.55 times more return on investment than MCKESSON. However, Westinghouse Air is 5.55 times more volatile than MCKESSON P NEW. It trades about 0.1 of its potential returns per unit of risk. MCKESSON P NEW is currently generating about -0.22 per unit of risk. If you would invest 18,044 in Westinghouse Air Brake on September 24, 2024 and sell it today you would earn a total of 1,259 from holding Westinghouse Air Brake or generate 6.98% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 89.06% |
Values | Daily Returns |
Westinghouse Air Brake vs. MCKESSON P NEW
Performance |
Timeline |
Westinghouse Air Brake |
MCKESSON P NEW |
Westinghouse Air and MCKESSON Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Westinghouse Air and MCKESSON
The main advantage of trading using opposite Westinghouse Air and MCKESSON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westinghouse Air position performs unexpectedly, MCKESSON 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 MCKESSON will offset losses from the drop in MCKESSON's long position.Westinghouse Air vs. LB Foster | Westinghouse Air vs. CSX Corporation | Westinghouse Air vs. Trinity Industries | Westinghouse Air vs. Norfolk Southern |
MCKESSON vs. Westinghouse Air Brake | MCKESSON vs. Porvair plc | MCKESSON vs. AerSale Corp | MCKESSON vs. Deluxe |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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