Correlation Between Worthington Steel and Aviat Networks
Can any of the company-specific risk be diversified away by investing in both Worthington Steel and Aviat Networks 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 Worthington Steel and Aviat Networks into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Worthington Steel and Aviat Networks, you can compare the effects of market volatilities on Worthington Steel and Aviat Networks 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 Worthington Steel with a short position of Aviat Networks. Check out your portfolio center. Please also check ongoing floating volatility patterns of Worthington Steel and Aviat Networks.
Diversification Opportunities for Worthington Steel and Aviat Networks
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Worthington and Aviat is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding Worthington Steel and Aviat Networks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aviat Networks and Worthington Steel 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 Worthington Steel are associated (or correlated) with Aviat Networks. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aviat Networks has no effect on the direction of Worthington Steel i.e., Worthington Steel and Aviat Networks go up and down completely randomly.
Pair Corralation between Worthington Steel and Aviat Networks
Allowing for the 90-day total investment horizon Worthington Steel is expected to generate 1.53 times more return on investment than Aviat Networks. However, Worthington Steel is 1.53 times more volatile than Aviat Networks. It trades about 0.15 of its potential returns per unit of risk. Aviat Networks is currently generating about 0.08 per unit of risk. If you would invest 2,474 in Worthington Steel on May 30, 2025 and sell it today you would earn a total of 858.00 from holding Worthington Steel or generate 34.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Worthington Steel vs. Aviat Networks
Performance |
| Timeline |
| Worthington Steel |
| Aviat Networks |
Worthington Steel and Aviat Networks Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Worthington Steel and Aviat Networks
The main advantage of trading using opposite Worthington Steel and Aviat Networks positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Worthington Steel position performs unexpectedly, Aviat Networks 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 Aviat Networks will offset losses from the drop in Aviat Networks' long position.| Worthington Steel vs. Cracker Barrel Old | Worthington Steel vs. Kuke Music Holding | Worthington Steel vs. Teleflex Incorporated | Worthington Steel vs. Yum Brands |
| Aviat Networks vs. Cambium Networks Corp | Aviat Networks vs. Ceragon Networks | Aviat Networks vs. KVH Industries | Aviat Networks vs. Knowles Cor |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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