Correlation Between Hyster Yale and Lindsay
Can any of the company-specific risk be diversified away by investing in both Hyster Yale and Lindsay 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 Lindsay 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 Lindsay, you can compare the effects of market volatilities on Hyster Yale and Lindsay 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 Lindsay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyster Yale and Lindsay.
Diversification Opportunities for Hyster Yale and Lindsay
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hyster and Lindsay is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Hyster Yale Materials Handling and Lindsay in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lindsay 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 Lindsay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lindsay has no effect on the direction of Hyster Yale i.e., Hyster Yale and Lindsay go up and down completely randomly.
Pair Corralation between Hyster Yale and Lindsay
Allowing for the 90-day total investment horizon Hyster Yale is expected to generate 2.24 times less return on investment than Lindsay. But when comparing it to its historical volatility, Hyster Yale Materials Handling is 1.03 times less risky than Lindsay. It trades about 0.23 of its potential returns per unit of risk. Lindsay is currently generating about 0.49 of returns per unit of risk over similar time horizon. If you would invest 11,831 in Lindsay on November 1, 2024 and sell it today you would earn a total of 1,790 from holding Lindsay or generate 15.13% 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. Lindsay
Performance |
| Timeline |
| Hyster Yale Materials |
| Lindsay |
Hyster Yale and Lindsay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyster Yale and Lindsay
The main advantage of trading using opposite Hyster Yale and Lindsay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyster Yale position performs unexpectedly, Lindsay 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 Lindsay will offset losses from the drop in Lindsay's long position.| Hyster Yale vs. Astec Industries | Hyster Yale vs. Shyft Group | Hyster Yale vs. Rev Group | Hyster Yale vs. Alamo Group |
| Lindsay vs. Columbus McKinnon | Lindsay vs. Astec Industries | Lindsay vs. Shyft Group | Lindsay vs. AGCO Corporation |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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