Correlation Between Pool and Regal Beloit
Can any of the company-specific risk be diversified away by investing in both Pool and Regal Beloit 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 Pool and Regal Beloit into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pool Corporation and Regal Beloit, you can compare the effects of market volatilities on Pool and Regal Beloit 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 Pool with a short position of Regal Beloit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pool and Regal Beloit.
Diversification Opportunities for Pool and Regal Beloit
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Pool and Regal is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Pool Corp. and Regal Beloit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regal Beloit and Pool 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 Pool Corporation are associated (or correlated) with Regal Beloit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regal Beloit has no effect on the direction of Pool i.e., Pool and Regal Beloit go up and down completely randomly.
Pair Corralation between Pool and Regal Beloit
Given the investment horizon of 90 days Pool Corporation is expected to under-perform the Regal Beloit. But the stock apears to be less risky and, when comparing its historical volatility, Pool Corporation is 1.36 times less risky than Regal Beloit. The stock trades about -0.05 of its potential returns per unit of risk. The Regal Beloit is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 15,407 in Regal Beloit on July 24, 2025 and sell it today you would lose (715.00) from holding Regal Beloit or give up 4.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pool Corp. vs. Regal Beloit
Performance |
| Timeline |
| Pool |
| Regal Beloit |
Pool and Regal Beloit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pool and Regal Beloit
The main advantage of trading using opposite Pool and Regal Beloit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pool position performs unexpectedly, Regal Beloit 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 Regal Beloit will offset losses from the drop in Regal Beloit's long position.| Pool vs. WESCO International | Pool vs. Core Main | Pool vs. Applied Industrial Technologies | Pool vs. Generac Holdings |
| Regal Beloit vs. IDEX Corporation | Regal Beloit vs. Watts Water Technologies | Regal Beloit vs. Donaldson | Regal Beloit vs. Gorman Rupp |
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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