Correlation Between Expeditors International and Forward Air
Can any of the company-specific risk be diversified away by investing in both Expeditors International and Forward Air 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 Expeditors International and Forward Air into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Expeditors International of and Forward Air, you can compare the effects of market volatilities on Expeditors International and Forward Air 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 Expeditors International with a short position of Forward Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Expeditors International and Forward Air.
Diversification Opportunities for Expeditors International and Forward Air
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Expeditors and Forward is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Expeditors International of and Forward Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Forward Air and Expeditors International 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 Expeditors International of are associated (or correlated) with Forward Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Forward Air has no effect on the direction of Expeditors International i.e., Expeditors International and Forward Air go up and down completely randomly.
Pair Corralation between Expeditors International and Forward Air
Given the investment horizon of 90 days Expeditors International is expected to generate 10.25 times less return on investment than Forward Air. But when comparing it to its historical volatility, Expeditors International of is 2.7 times less risky than Forward Air. It trades about 0.07 of its potential returns per unit of risk. Forward Air is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 1,712 in Forward Air on May 26, 2025 and sell it today you would earn a total of 1,375 from holding Forward Air or generate 80.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Expeditors International of vs. Forward Air
Performance |
| Timeline |
| Expeditors International |
| Forward Air |
Expeditors International and Forward Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Expeditors International and Forward Air
The main advantage of trading using opposite Expeditors International and Forward Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Expeditors International position performs unexpectedly, Forward Air 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 Forward Air will offset losses from the drop in Forward Air's long position.| Expeditors International vs. Landstar System | Expeditors International vs. JB Hunt Transport | Expeditors International vs. Hub Group | Expeditors International vs. Forward Air |
| Forward Air vs. Landstar System | Forward Air vs. JB Hunt Transport | Forward Air vs. Expeditors International of | Forward Air vs. CH Robinson Worldwide |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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