Correlation Between Hyster-Yale Materials and Magic Software
Can any of the company-specific risk be diversified away by investing in both Hyster-Yale Materials and Magic Software 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 Materials and Magic Software 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 Magic Software Enterprises, you can compare the effects of market volatilities on Hyster-Yale Materials and Magic Software 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 Materials with a short position of Magic Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyster-Yale Materials and Magic Software.
Diversification Opportunities for Hyster-Yale Materials and Magic Software
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Hyster-Yale and Magic is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Hyster Yale Materials Handling and Magic Software Enterprises in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magic Software Enter and Hyster-Yale Materials 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 Magic Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magic Software Enter has no effect on the direction of Hyster-Yale Materials i.e., Hyster-Yale Materials and Magic Software go up and down completely randomly.
Pair Corralation between Hyster-Yale Materials and Magic Software
Assuming the 90 days trading horizon Hyster Yale Materials Handling is expected to under-perform the Magic Software. In addition to that, Hyster-Yale Materials is 1.14 times more volatile than Magic Software Enterprises. It trades about -0.23 of its total potential returns per unit of risk. Magic Software Enterprises is currently generating about -0.01 per unit of volatility. If you would invest 1,116 in Magic Software Enterprises on October 16, 2024 and sell it today you would lose (6.00) from holding Magic Software Enterprises or give up 0.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyster Yale Materials Handling vs. Magic Software Enterprises
Performance |
| Timeline |
| Hyster Yale Materials |
| Magic Software Enter |
Hyster-Yale Materials and Magic Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyster-Yale Materials and Magic Software
The main advantage of trading using opposite Hyster-Yale Materials and Magic Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyster-Yale Materials position performs unexpectedly, Magic Software 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 Magic Software will offset losses from the drop in Magic Software's long position.| Hyster-Yale Materials vs. CHINA EDUCATION GROUP | Hyster-Yale Materials vs. Perdoceo Education | Hyster-Yale Materials vs. Tokyu Construction Co | Hyster-Yale Materials vs. American Public Education |
| Magic Software vs. Materialise NV | Magic Software vs. Hyster Yale Materials Handling | Magic Software vs. Compagnie Plastic Omnium | Magic Software vs. Vulcan Materials |
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 Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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