Correlation Between Hyster Yale and Terex
Can any of the company-specific risk be diversified away by investing in both Hyster Yale and Terex 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 Terex 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 Terex, you can compare the effects of market volatilities on Hyster Yale and Terex 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 Terex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyster Yale and Terex.
Diversification Opportunities for Hyster Yale and Terex
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Hyster and Terex is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Hyster Yale Materials Handling and Terex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Terex 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 Terex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Terex has no effect on the direction of Hyster Yale i.e., Hyster Yale and Terex go up and down completely randomly.
Pair Corralation between Hyster Yale and Terex
Allowing for the 90-day total investment horizon Hyster Yale Materials Handling is expected to generate 1.24 times more return on investment than Terex. However, Hyster Yale is 1.24 times more volatile than Terex. It trades about 0.06 of its potential returns per unit of risk. Terex is currently generating about 0.03 per unit of risk. If you would invest 2,876 in Hyster Yale Materials Handling on August 27, 2024 and sell it today you would earn a total of 2,803 from holding Hyster Yale Materials Handling or generate 97.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyster Yale Materials Handling vs. Terex
Performance |
| Timeline |
| Hyster Yale Materials |
| Terex |
Hyster Yale and Terex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyster Yale and Terex
The main advantage of trading using opposite Hyster Yale and Terex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyster Yale position performs unexpectedly, Terex 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 Terex will offset losses from the drop in Terex's long position.| Hyster Yale vs. Xos Inc | Hyster Yale vs. Nikola Corp | Hyster Yale vs. Wabash National | Hyster Yale vs. American Premium Water |
| Terex vs. Lion Electric Corp | Terex vs. Xos Inc | Terex vs. Hydrofarm Holdings Group | Terex 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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