Correlation Between Westinghouse Air and BTX Old

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Westinghouse Air and BTX Old 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 Westinghouse Air and BTX Old into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Westinghouse Air Brake and BTX Old, you can compare the effects of market volatilities on Westinghouse Air and BTX Old 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 Westinghouse Air with a short position of BTX Old. Check out your portfolio center. Please also check ongoing floating volatility patterns of Westinghouse Air and BTX Old.

Diversification Opportunities for Westinghouse Air and BTX Old

  Correlation Coefficient

Poor diversification

The 3 months correlation between Westinghouse and BTX Old is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Westinghouse Air Brake and BTX Old in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BTX Old and Westinghouse Air 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 Westinghouse Air Brake are associated (or correlated) with BTX Old. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BTX Old has no effect on the direction of Westinghouse Air i.e., Westinghouse Air and BTX Old go up and down completely randomly.

Pair Corralation between Westinghouse Air and BTX Old

Considering the 90-day investment horizon Westinghouse Air is expected to generate 1.34 times less return on investment than BTX Old. But when comparing it to its historical volatility, Westinghouse Air Brake is 4.39 times less risky than BTX Old. It trades about 0.16 of its potential returns per unit of risk. BTX Old is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  324.00  in BTX Old on September 8, 2022 and sell it today you would earn a total of  6.00  from holding BTX Old or generate 1.85% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
ValuesDaily Returns

Westinghouse Air Brake  vs.  BTX Old

 Performance (%) 
Westinghouse Air Brake 
Westinghouse Performance
8 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Westinghouse Air Brake are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat conflicting basic indicators, Westinghouse Air sustained solid returns over the last few months and may actually be approaching a breakup point.

Westinghouse Price Channel

BTX Old 
BTX Old Performance
0 of 100
Over the last 90 days BTX Old has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly weak basic indicators, BTX Old showed solid returns over the last few months and may actually be approaching a breakup point.

Westinghouse Air and BTX Old Volatility Contrast

   Predicted Return Density   

Pair Trading with Westinghouse Air and BTX Old

The main advantage of trading using opposite Westinghouse Air and BTX Old positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Westinghouse Air position performs unexpectedly, BTX Old 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 BTX Old will offset losses from the drop in BTX Old's long position.
Westinghouse Air vs. Diamond Offshore Drilling
Westinghouse Air vs. Fuwei Films Holdings
Westinghouse Air vs. TechnipFMC PLC
Westinghouse Air vs. WW Grainger
The idea behind Westinghouse Air Brake and BTX Old 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.
BTX Old vs. Tsingtao Brewery Co
BTX Old vs. Heineken Holding NV
BTX Old vs. Arca Continental SAB
BTX Old vs. Diageo Plc
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 Piotroski F Score module to get Piotroski F Score based on binary analysis strategy of nine different fundamentals.

Other Complementary Tools

Watchlist Optimization
Optimize watchlists to build efficient portfolio or rebalance existing positions based on mean-variance optimization algorithm
Theme Ratings
Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance
Idea Optimizer
Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Fundamentals Comparison
Compare fundamentals across multiple equities to find investing opportunities
Risk-Return Analysis
View associations between returns expected from investment and the risk you assume
Portfolio File Import
Quickly import all of your third-party portfolios from your local drive in csv format
Balance Of Power
Check stock momentum by analyzing Balance Of Power indicator and other technical ratios
Money Managers
Screen money managers from public funds and ETFs managed around the world
Portfolio Diagnostics
Use generated alerts and portfolio events aggregator to diagnose current holdings
Portfolio Holdings
Check your current holdings and cash postion to detemine if your portfolio needs rebalancing
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like
Premium Stories
Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope