Correlation Between CNH Industrial and Shyft
Can any of the company-specific risk be diversified away by investing in both CNH Industrial and Shyft 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 CNH Industrial and Shyft into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CNH Industrial NV and Shyft Group, you can compare the effects of market volatilities on CNH Industrial and Shyft 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 CNH Industrial with a short position of Shyft. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNH Industrial and Shyft.
Diversification Opportunities for CNH Industrial and Shyft
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CNH and Shyft is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding CNH Industrial NV and Shyft Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shyft Group and CNH 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 CNH Industrial NV are associated (or correlated) with Shyft. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shyft Group has no effect on the direction of CNH Industrial i.e., CNH Industrial and Shyft go up and down completely randomly.
Pair Corralation between CNH Industrial and Shyft
Given the investment horizon of 90 days CNH Industrial NV is expected to under-perform the Shyft. But the stock apears to be less risky and, when comparing its historical volatility, CNH Industrial NV is 1.43 times less risky than Shyft. The stock trades about -0.03 of its potential returns per unit of risk. The Shyft Group is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 2,232 in Shyft Group on August 24, 2024 and sell it today you would lose (854.00) from holding Shyft Group or give up 38.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 59.52% |
| Values | Daily Returns |
CNH Industrial NV vs. Shyft Group
Performance |
| Timeline |
| CNH Industrial NV |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Shyft Group |
CNH Industrial and Shyft Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CNH Industrial and Shyft
The main advantage of trading using opposite CNH Industrial and Shyft positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CNH Industrial position performs unexpectedly, Shyft 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 Shyft will offset losses from the drop in Shyft's long position.| CNH Industrial vs. Deere Company | CNH Industrial vs. Lindsay | CNH Industrial vs. Alamo Group | CNH Industrial vs. Caterpillar |
| Shyft vs. Astec Industries | Shyft vs. Hyster Yale Materials Handling | Shyft vs. Manitex International | Shyft vs. Rev 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |