Correlation Between Boeing and Pentair Plc

Can any of the company-specific risk be diversified away by investing in both Boeing and Pentair Plc 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 Boeing and Pentair Plc into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between The Boeing and Pentair plc, you can compare the effects of market volatilities on Boeing and Pentair Plc 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 Boeing with a short position of Pentair Plc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boeing and Pentair Plc.

Diversification Opportunities for Boeing and Pentair Plc

0.93

Correlation Coefficient

Boeing  Pentair Plc

Almost no diversification

The 3 months correlation between Boeing and Pentair is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding The Boeing and Pentair plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pentair plc and Boeing 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 The Boeing are associated (or correlated) with Pentair Plc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pentair plc has no effect on the direction of Boeing i.e., Boeing and Pentair Plc go up and down completely randomly.

Pair Corralation between Boeing and Pentair Plc

Assuming the 90 days horizon The Boeing is expected to generate 1.32 times more return on investment than Pentair Plc. However, Boeing is 1.32 times more volatile than Pentair plc. It trades about 0.25 of its potential returns per unit of risk. Pentair plc is currently generating about 0.22 per unit of risk. If you would invest  13,936  in The Boeing on April 20, 2025 and sell it today you would earn a total of  5,714  from holding The Boeing or generate 41.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	98.44%
Values	Daily Returns

The Boeing  vs.  Pentair plc

Boeing

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in The Boeing are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Boeing reported solid returns over the last few months and may actually be approaching a breakup point.

Pentair plc

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Pentair plc are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Pentair Plc reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Boeing and Pentair Plc

The main advantage of trading using opposite Boeing and Pentair Plc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boeing position performs unexpectedly, Pentair Plc 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 Pentair Plc will offset losses from the drop in Pentair Plc's long position.

The idea behind The Boeing and Pentair plc 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.