Correlation Between Hurco Companies and EMCOR
Can any of the company-specific risk be diversified away by investing in both Hurco Companies and EMCOR 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 Hurco Companies and EMCOR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hurco Companies and EMCOR Group, you can compare the effects of market volatilities on Hurco Companies and EMCOR 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 Hurco Companies with a short position of EMCOR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hurco Companies and EMCOR.
Diversification Opportunities for Hurco Companies and EMCOR
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hurco and EMCOR is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Hurco Companies and EMCOR Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EMCOR Group and Hurco Companies 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 Hurco Companies are associated (or correlated) with EMCOR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EMCOR Group has no effect on the direction of Hurco Companies i.e., Hurco Companies and EMCOR go up and down completely randomly.
Pair Corralation between Hurco Companies and EMCOR
Given the investment horizon of 90 days Hurco Companies is expected to generate 0.72 times more return on investment than EMCOR. However, Hurco Companies is 1.39 times less risky than EMCOR. It trades about 0.13 of its potential returns per unit of risk. EMCOR Group is currently generating about 0.0 per unit of risk. If you would invest 1,978 in Hurco Companies on November 3, 2024 and sell it today you would earn a total of 171.00 from holding Hurco Companies or generate 8.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hurco Companies vs. EMCOR Group
Performance |
| Timeline |
| Hurco Companies |
| EMCOR Group |
Hurco Companies and EMCOR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hurco Companies and EMCOR
The main advantage of trading using opposite Hurco Companies and EMCOR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hurco Companies position performs unexpectedly, EMCOR 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 EMCOR will offset losses from the drop in EMCOR's long position.| 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 CEOs Directory module to screen CEOs from public companies around the world.
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