Correlation Between Fastenal and Inter Co
Can any of the company-specific risk be diversified away by investing in both Fastenal and Inter Co 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 Fastenal and Inter Co into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fastenal Company and Inter Co Class, you can compare the effects of market volatilities on Fastenal and Inter Co 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 Fastenal with a short position of Inter Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fastenal and Inter Co.
Diversification Opportunities for Fastenal and Inter Co
Excellent diversification
The 3 months correlation between Fastenal and Inter is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Fastenal Company and Inter Co Class in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inter Co Class and Fastenal 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 Fastenal Company are associated (or correlated) with Inter Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inter Co Class has no effect on the direction of Fastenal i.e., Fastenal and Inter Co go up and down completely randomly.
Pair Corralation between Fastenal and Inter Co
Given the investment horizon of 90 days Fastenal Company is expected to under-perform the Inter Co. But the stock apears to be less risky and, when comparing its historical volatility, Fastenal Company is 1.61 times less risky than Inter Co. The stock trades about -0.22 of its potential returns per unit of risk. The Inter Co Class is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 776.00 in Inter Co Class on August 20, 2025 and sell it today you would earn a total of 112.00 from holding Inter Co Class or generate 14.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fastenal Company vs. Inter Co Class
Performance |
| Timeline |
| Fastenal |
| Inter Co Class |
Fastenal and Inter Co Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fastenal and Inter Co
The main advantage of trading using opposite Fastenal and Inter Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fastenal position performs unexpectedly, Inter Co 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 Inter Co will offset losses from the drop in Inter Co's long position.| Fastenal vs. Ferguson Plc | Fastenal vs. WW Grainger | Fastenal vs. Ametek Inc | Fastenal vs. Roper Technologies, |
| Inter Co vs. Associated Banc Corp | Inter Co vs. Webster Financial | Inter Co vs. Cadence Bancorp | Inter Co vs. First Financial Bankshares |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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