Correlation Between Gencor Industries and Manitowoc
Can any of the company-specific risk be diversified away by investing in both Gencor Industries and Manitowoc 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 Gencor Industries and Manitowoc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gencor Industries and Manitowoc, you can compare the effects of market volatilities on Gencor Industries and Manitowoc 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 Gencor Industries with a short position of Manitowoc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gencor Industries and Manitowoc.
Diversification Opportunities for Gencor Industries and Manitowoc
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Gencor and Manitowoc is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Gencor Industries and Manitowoc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manitowoc and Gencor Industries 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 Gencor Industries are associated (or correlated) with Manitowoc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manitowoc has no effect on the direction of Gencor Industries i.e., Gencor Industries and Manitowoc go up and down completely randomly.
Pair Corralation between Gencor Industries and Manitowoc
Given the investment horizon of 90 days Gencor Industries is expected to generate 0.45 times more return on investment than Manitowoc. However, Gencor Industries is 2.23 times less risky than Manitowoc. It trades about 0.21 of its potential returns per unit of risk. Manitowoc is currently generating about 0.09 per unit of risk. If you would invest 2,015 in Gencor Industries on August 27, 2024 and sell it today you would earn a total of 219.00 from holding Gencor Industries or generate 10.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gencor Industries vs. Manitowoc
Performance |
| Timeline |
| Gencor Industries |
| Manitowoc |
Gencor Industries and Manitowoc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gencor Industries and Manitowoc
The main advantage of trading using opposite Gencor Industries and Manitowoc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gencor Industries position performs unexpectedly, Manitowoc 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 Manitowoc will offset losses from the drop in Manitowoc's long position.| Gencor Industries vs. Alamo Group | Gencor Industries vs. Manitowoc | Gencor Industries vs. Manitex International | Gencor Industries vs. Columbus McKinnon |
| Manitowoc vs. Oshkosh | Manitowoc vs. Alamo Group | Manitowoc vs. Wabash National | Manitowoc vs. Hyster Yale Materials Handling |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |