Correlation Between Flowserve and Moog

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Can any of the company-specific risk be diversified away by investing in both Flowserve and Moog 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 Flowserve and Moog into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flowserve and Moog Inc, you can compare the effects of market volatilities on Flowserve and Moog 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 Flowserve with a short position of Moog. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flowserve and Moog.

Diversification Opportunities for Flowserve and Moog

0.15
  Correlation Coefficient

Average diversification

The 3 months correlation between Flowserve and Moog is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Flowserve and Moog Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moog Inc and Flowserve 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 Flowserve are associated (or correlated) with Moog. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moog Inc has no effect on the direction of Flowserve i.e., Flowserve and Moog go up and down completely randomly.

Pair Corralation between Flowserve and Moog

Considering the 90-day investment horizon Flowserve is expected to generate 2.34 times more return on investment than Moog. However, Flowserve is 2.34 times more volatile than Moog Inc. It trades about 0.12 of its potential returns per unit of risk. Moog Inc is currently generating about 0.14 per unit of risk. If you would invest  5,331  in Flowserve on August 30, 2025 and sell it today you would earn a total of  1,725  from holding Flowserve or generate 32.36% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Flowserve  vs.  Moog Inc

 Performance 
       Timeline  
Flowserve 

Risk-Adjusted Performance

Fair

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Flowserve are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile essential indicators, Flowserve unveiled solid returns over the last few months and may actually be approaching a breakup point.
Moog Inc 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Moog Inc are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite somewhat fragile basic indicators, Moog sustained solid returns over the last few months and may actually be approaching a breakup point.

Flowserve and Moog Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Flowserve and Moog

The main advantage of trading using opposite Flowserve and Moog positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flowserve position performs unexpectedly, Moog 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 Moog will offset losses from the drop in Moog's long position.
The idea behind Flowserve and Moog Inc pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.

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