Correlation Between Ecolab and Brunswick Corp
Can any of the company-specific risk be diversified away by investing in both Ecolab and Brunswick Corp 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 Ecolab and Brunswick Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ecolab Inc and Brunswick Corp, you can compare the effects of market volatilities on Ecolab and Brunswick Corp 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 Ecolab with a short position of Brunswick Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecolab and Brunswick Corp.
Diversification Opportunities for Ecolab and Brunswick Corp
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ecolab and Brunswick is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Ecolab Inc and Brunswick Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Brunswick Corp and Ecolab 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 Ecolab Inc are associated (or correlated) with Brunswick Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Brunswick Corp has no effect on the direction of Ecolab i.e., Ecolab and Brunswick Corp go up and down completely randomly.
Pair Corralation between Ecolab and Brunswick Corp
Considering the 90-day investment horizon Ecolab is expected to generate 1.36 times less return on investment than Brunswick Corp. In addition to that, Ecolab is 1.91 times more volatile than Brunswick Corp. It trades about 0.08 of its total potential returns per unit of risk. Brunswick Corp is currently generating about 0.2 per unit of volatility. If you would invest 2,309 in Brunswick Corp on June 3, 2025 and sell it today you would earn a total of 156.00 from holding Brunswick Corp or generate 6.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ecolab Inc vs. Brunswick Corp
Performance |
| Timeline |
| Ecolab Inc |
| Brunswick Corp |
Ecolab and Brunswick Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecolab and Brunswick Corp
The main advantage of trading using opposite Ecolab and Brunswick Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecolab position performs unexpectedly, Brunswick Corp 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 Brunswick Corp will offset losses from the drop in Brunswick Corp's long position.| Ecolab vs. Linde plc Ordinary | Ecolab vs. PPG Industries | Ecolab vs. Sherwin Williams Co | Ecolab vs. LyondellBasell Industries NV |
| Brunswick Corp vs. Nasdaq Inc | Brunswick Corp vs. Juniata Valley Financial | Brunswick Corp vs. Arrow Financial | Brunswick Corp vs. Zane Interactive Publishing |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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