Correlation Between Hyster Yale and Alamo
Can any of the company-specific risk be diversified away by investing in both Hyster Yale and Alamo 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 Hyster Yale and Alamo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hyster Yale Materials Handling and Alamo Group, you can compare the effects of market volatilities on Hyster Yale and Alamo 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 Hyster Yale with a short position of Alamo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyster Yale and Alamo.
Diversification Opportunities for Hyster Yale and Alamo
-0.27 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hyster and Alamo is -0.27. Overlapping area represents the amount of risk that can be diversified away by holding Hyster Yale Materials Handling and Alamo Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alamo Group and Hyster Yale 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 Hyster Yale Materials Handling are associated (or correlated) with Alamo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alamo Group has no effect on the direction of Hyster Yale i.e., Hyster Yale and Alamo go up and down completely randomly.
Pair Corralation between Hyster Yale and Alamo
Allowing for the 90-day total investment horizon Hyster Yale Materials Handling is expected to generate 0.99 times more return on investment than Alamo. However, Hyster Yale Materials Handling is 1.01 times less risky than Alamo. It trades about 0.23 of its potential returns per unit of risk. Alamo Group is currently generating about 0.06 per unit of risk. If you would invest 5,093 in Hyster Yale Materials Handling on November 1, 2024 and sell it today you would earn a total of 326.00 from holding Hyster Yale Materials Handling or generate 6.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyster Yale Materials Handling vs. Alamo Group
Performance |
| Timeline |
| Hyster Yale Materials |
| Alamo Group |
Hyster Yale and Alamo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyster Yale and Alamo
The main advantage of trading using opposite Hyster Yale and Alamo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyster Yale position performs unexpectedly, Alamo 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 Alamo will offset losses from the drop in Alamo's long position.| Hyster Yale vs. Astec Industries | Hyster Yale vs. Shyft Group | Hyster Yale vs. Rev Group | Hyster Yale vs. Alamo Group |
| Alamo vs. Hyster Yale Materials Handling | Alamo vs. Columbus McKinnon | Alamo vs. AGCO Corporation | Alamo vs. Titan International |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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