Correlation Between Gencor Industries and Textainer Group
Can any of the company-specific risk be diversified away by investing in both Gencor Industries and Textainer Group 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 Textainer Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Gencor Industries and Textainer Group Holdings, you can compare the effects of market volatilities on Gencor Industries and Textainer Group 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 Textainer Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gencor Industries and Textainer Group.
Diversification Opportunities for Gencor Industries and Textainer Group
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Gencor and Textainer is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Gencor Industries and Textainer Group Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Textainer Group Holdings 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 Textainer Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Textainer Group Holdings has no effect on the direction of Gencor Industries i.e., Gencor Industries and Textainer Group go up and down completely randomly.
Pair Corralation between Gencor Industries and Textainer Group
Given the investment horizon of 90 days Gencor Industries is expected to generate 1.21 times less return on investment than Textainer Group. But when comparing it to its historical volatility, Gencor Industries is 1.55 times less risky than Textainer Group. It trades about 0.08 of its potential returns per unit of risk. Textainer Group Holdings is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 34.00 in Textainer Group Holdings on August 28, 2024 and sell it today you would earn a total of 39.00 from holding Textainer Group Holdings or generate 114.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Gencor Industries vs. Textainer Group Holdings
Performance |
| Timeline |
| Gencor Industries |
| Textainer Group Holdings |
Gencor Industries and Textainer Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gencor Industries and Textainer Group
The main advantage of trading using opposite Gencor Industries and Textainer Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gencor Industries position performs unexpectedly, Textainer Group 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 Textainer Group will offset losses from the drop in Textainer Group's long position.| Gencor Industries vs. Alamo Group | Gencor Industries vs. Manitowoc | Gencor Industries vs. Manitex International | Gencor Industries vs. Columbus McKinnon |
| Textainer Group vs. Buhler Industries | Textainer Group vs. Austin Engineering Limited | Textainer Group vs. Ag Growth International | Textainer Group vs. Grow Solutions Holdings |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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