Correlation Between Alta Equipment and FlexShopper
Can any of the company-specific risk be diversified away by investing in both Alta Equipment and FlexShopper 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 Alta Equipment and FlexShopper into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alta Equipment Group and FlexShopper, you can compare the effects of market volatilities on Alta Equipment and FlexShopper 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 Alta Equipment with a short position of FlexShopper. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alta Equipment and FlexShopper.
Diversification Opportunities for Alta Equipment and FlexShopper
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Alta and FlexShopper is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Alta Equipment Group and FlexShopper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FlexShopper and Alta Equipment 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 Alta Equipment Group are associated (or correlated) with FlexShopper. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FlexShopper has no effect on the direction of Alta Equipment i.e., Alta Equipment and FlexShopper go up and down completely randomly.
Pair Corralation between Alta Equipment and FlexShopper
Given the investment horizon of 90 days Alta Equipment Group is expected to generate 0.89 times more return on investment than FlexShopper. However, Alta Equipment Group is 1.13 times less risky than FlexShopper. It trades about 0.19 of its potential returns per unit of risk. FlexShopper is currently generating about 0.13 per unit of risk. If you would invest 623.00 in Alta Equipment Group on August 24, 2024 and sell it today you would earn a total of 128.00 from holding Alta Equipment Group or generate 20.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alta Equipment Group vs. FlexShopper
Performance |
| Timeline |
| Alta Equipment Group |
| FlexShopper |
Alta Equipment and FlexShopper Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alta Equipment and FlexShopper
The main advantage of trading using opposite Alta Equipment and FlexShopper positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alta Equipment position performs unexpectedly, FlexShopper 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 FlexShopper will offset losses from the drop in FlexShopper's long position.| Alta Equipment vs. PROG Holdings | Alta Equipment vs. GATX Corporation | Alta Equipment vs. McGrath RentCorp | Alta Equipment vs. Custom Truck One |
| FlexShopper vs. AZN Capital Corp | FlexShopper vs. Fortress Transportation and | FlexShopper vs. Ashtead Gro | FlexShopper vs. Alta Equipment Group |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| 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 | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Global Correlations Find global opportunities by holding instruments from different markets |