Correlation Between Graco and Hurco Companies
Can any of the company-specific risk be diversified away by investing in both Graco and Hurco Companies 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 Graco and Hurco Companies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Graco Inc and Hurco Companies, you can compare the effects of market volatilities on Graco and Hurco Companies 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 Graco with a short position of Hurco Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Graco and Hurco Companies.
Diversification Opportunities for Graco and Hurco Companies
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Graco and Hurco is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Graco Inc and Hurco Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hurco Companies and Graco 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 Graco Inc are associated (or correlated) with Hurco Companies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hurco Companies has no effect on the direction of Graco i.e., Graco and Hurco Companies go up and down completely randomly.
Pair Corralation between Graco and Hurco Companies
Considering the 90-day investment horizon Graco is expected to generate 2.61 times less return on investment than Hurco Companies. But when comparing it to its historical volatility, Graco Inc is 1.76 times less risky than Hurco Companies. It trades about 0.08 of its potential returns per unit of risk. Hurco Companies is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 2,107 in Hurco Companies on August 30, 2024 and sell it today you would earn a total of 212.00 from holding Hurco Companies or generate 10.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Graco Inc vs. Hurco Companies
Performance |
| Timeline |
| Graco Inc |
| Hurco Companies |
Graco and Hurco Companies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Graco and Hurco Companies
The main advantage of trading using opposite Graco and Hurco Companies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Graco position performs unexpectedly, Hurco Companies 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 Hurco Companies will offset losses from the drop in Hurco Companies' long position.The idea behind Graco Inc and Hurco Companies pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Hurco Companies vs. Enerpac Tool Group | Hurco Companies vs. Enpro Industries | Hurco Companies vs. Omega Flex | Hurco Companies vs. Gorman Rupp |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets |