Correlation Between Zurn Elkay and Quanex Building
Can any of the company-specific risk be diversified away by investing in both Zurn Elkay and Quanex Building 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 Zurn Elkay and Quanex Building into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Zurn Elkay Water and Quanex Building Products, you can compare the effects of market volatilities on Zurn Elkay and Quanex Building 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 Zurn Elkay with a short position of Quanex Building. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zurn Elkay and Quanex Building.
Diversification Opportunities for Zurn Elkay and Quanex Building
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Zurn and Quanex is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Zurn Elkay Water and Quanex Building Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quanex Building Products and Zurn Elkay 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 Zurn Elkay Water are associated (or correlated) with Quanex Building. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quanex Building Products has no effect on the direction of Zurn Elkay i.e., Zurn Elkay and Quanex Building go up and down completely randomly.
Pair Corralation between Zurn Elkay and Quanex Building
Considering the 90-day investment horizon Zurn Elkay Water is expected to generate 0.57 times more return on investment than Quanex Building. However, Zurn Elkay Water is 1.74 times less risky than Quanex Building. It trades about 0.18 of its potential returns per unit of risk. Quanex Building Products is currently generating about -0.11 per unit of risk. If you would invest 3,672 in Zurn Elkay Water on July 22, 2025 and sell it today you would earn a total of 902.00 from holding Zurn Elkay Water or generate 24.56% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Zurn Elkay Water vs. Quanex Building Products
Performance |
Timeline |
Zurn Elkay Water |
Quanex Building Products |
Zurn Elkay and Quanex Building Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Zurn Elkay and Quanex Building
The main advantage of trading using opposite Zurn Elkay and Quanex Building positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zurn Elkay position performs unexpectedly, Quanex Building 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 Quanex Building will offset losses from the drop in Quanex Building's long position.Zurn Elkay vs. Federal Signal | Zurn Elkay vs. IES Holdings | Zurn Elkay vs. Valmont Industries | Zurn Elkay vs. Primoris Services |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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