Correlation Between SERI INDUSTRIAL and Becton Dickinson

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

By analyzing existing cross correlation between SERI INDUSTRIAL EO and Becton Dickinson and, you can compare the effects of market volatilities on SERI INDUSTRIAL and Becton Dickinson 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 SERI INDUSTRIAL with a short position of Becton Dickinson. Check out your portfolio center. Please also check ongoing floating volatility patterns of SERI INDUSTRIAL and Becton Dickinson.

Diversification Opportunities for SERI INDUSTRIAL and Becton Dickinson

-0.39

Correlation Coefficient

SERI INDUSTRIAL  Becton Dickinson

Very good diversification

The 3 months correlation between SERI and Becton is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding SERI INDUSTRIAL EO and Becton Dickinson and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Becton Dickinson and SERI INDUSTRIAL 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 SERI INDUSTRIAL EO are associated (or correlated) with Becton Dickinson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Becton Dickinson has no effect on the direction of SERI INDUSTRIAL i.e., SERI INDUSTRIAL and Becton Dickinson go up and down completely randomly.

Pair Corralation between SERI INDUSTRIAL and Becton Dickinson

Assuming the 90 days trading horizon SERI INDUSTRIAL EO is expected to generate 1.57 times more return on investment than Becton Dickinson. However, SERI INDUSTRIAL is 1.57 times more volatile than Becton Dickinson and. It trades about 0.02 of its potential returns per unit of risk. Becton Dickinson and is currently generating about -0.04 per unit of risk. If you would invest  194.00  in SERI INDUSTRIAL EO on April 20, 2025 and sell it today you would earn a total of  1.00  from holding SERI INDUSTRIAL EO or generate 0.52% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

SERI INDUSTRIAL EO  vs.  Becton Dickinson and

SERI INDUSTRIAL EO

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SERI INDUSTRIAL EO are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable technical indicators, SERI INDUSTRIAL is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Becton Dickinson

Risk-Adjusted Performance

Very Weak

Over the last 90 days Becton Dickinson and has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with SERI INDUSTRIAL and Becton Dickinson

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

The idea behind SERI INDUSTRIAL EO and Becton Dickinson and 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.