Correlation Between HE Equipment and Textainer Group
Can any of the company-specific risk be diversified away by investing in both HE Equipment 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 HE Equipment and Textainer Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HE Equipment Services and Textainer Group Holdings, you can compare the effects of market volatilities on HE Equipment 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 HE Equipment with a short position of Textainer Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of HE Equipment and Textainer Group.
Diversification Opportunities for HE Equipment and Textainer Group
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between HEES and Textainer is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding HE Equipment Services 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 HE Equipment 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 HE Equipment Services 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 HE Equipment i.e., HE Equipment and Textainer Group go up and down completely randomly.
Pair Corralation between HE Equipment and Textainer Group
If you would invest 5,468 in HE Equipment Services on August 24, 2024 and sell it today you would earn a total of 200.00 from holding HE Equipment Services or generate 3.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 4.55% |
| Values | Daily Returns |
HE Equipment Services vs. Textainer Group Holdings
Performance |
| Timeline |
| HE Equipment Services |
| Textainer Group Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
HE Equipment and Textainer Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HE Equipment and Textainer Group
The main advantage of trading using opposite HE Equipment and Textainer Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HE Equipment 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.| HE Equipment vs. GATX Corporation | HE Equipment vs. McGrath RentCorp | HE Equipment vs. Alta Equipment Group | HE Equipment vs. Ryder System |
| Textainer Group vs. Ryder System | Textainer Group vs. Triton International Limited | Textainer Group vs. Air Lease | Textainer Group vs. Herc 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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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