Correlation Between EV Technology and Buhler Industries
Can any of the company-specific risk be diversified away by investing in both EV Technology and Buhler Industries 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 EV Technology and Buhler Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EV Technology Group and Buhler Industries, you can compare the effects of market volatilities on EV Technology and Buhler Industries 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 EV Technology with a short position of Buhler Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of EV Technology and Buhler Industries.
Diversification Opportunities for EV Technology and Buhler Industries
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between EVTGF and Buhler is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding EV Technology Group and Buhler Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Buhler Industries and EV Technology 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 EV Technology Group are associated (or correlated) with Buhler Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Buhler Industries has no effect on the direction of EV Technology i.e., EV Technology and Buhler Industries go up and down completely randomly.
Pair Corralation between EV Technology and Buhler Industries
Assuming the 90 days horizon EV Technology Group is expected to generate 23.3 times more return on investment than Buhler Industries. However, EV Technology is 23.3 times more volatile than Buhler Industries. It trades about 0.07 of its potential returns per unit of risk. Buhler Industries is currently generating about 0.04 per unit of risk. If you would invest 19.00 in EV Technology Group on August 30, 2024 and sell it today you would lose (18.59) from holding EV Technology Group or give up 97.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
EV Technology Group vs. Buhler Industries
Performance |
| Timeline |
| EV Technology Group |
| Buhler Industries |
EV Technology and Buhler Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EV Technology and Buhler Industries
The main advantage of trading using opposite EV Technology and Buhler Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EV Technology position performs unexpectedly, Buhler Industries 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 Buhler Industries will offset losses from the drop in Buhler Industries' long position.| EV Technology vs. Buhler Industries | EV Technology vs. AmeraMex International | EV Technology vs. Textainer Group Holdings | EV Technology vs. Deere Company |
| Buhler Industries vs. Deere Company | Buhler Industries vs. Columbus McKinnon | Buhler Industries vs. Hyster Yale Materials Handling | Buhler Industries vs. Manitowoc |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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