Correlation Between Hyster-Yale Materials and NKT A/S
Can any of the company-specific risk be diversified away by investing in both Hyster-Yale Materials and NKT A/S 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 NKT A/S 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 NKT AS, you can compare the effects of market volatilities on Hyster-Yale Materials and NKT A/S 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 NKT A/S. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyster-Yale Materials and NKT A/S.
Diversification Opportunities for Hyster-Yale Materials and NKT A/S
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hyster-Yale and NKT is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Hyster Yale Materials Handling and NKT AS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NKT A/S 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 NKT A/S. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NKT A/S has no effect on the direction of Hyster-Yale Materials i.e., Hyster-Yale Materials and NKT A/S go up and down completely randomly.
Pair Corralation between Hyster-Yale Materials and NKT A/S
Assuming the 90 days trading horizon Hyster Yale Materials Handling is expected to generate 1.43 times more return on investment than NKT A/S. However, Hyster-Yale Materials is 1.43 times more volatile than NKT AS. It trades about 0.03 of its potential returns per unit of risk. NKT AS is currently generating about 0.05 per unit of risk. If you would invest 4,532 in Hyster Yale Materials Handling on September 4, 2024 and sell it today you would earn a total of 718.00 from holding Hyster Yale Materials Handling or generate 15.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyster Yale Materials Handling vs. NKT AS
Performance |
| Timeline |
| Hyster Yale Materials |
| NKT A/S |
Hyster-Yale Materials and NKT A/S Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyster-Yale Materials and NKT A/S
The main advantage of trading using opposite Hyster-Yale Materials and NKT A/S positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyster-Yale Materials position performs unexpectedly, NKT A/S 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 NKT A/S will offset losses from the drop in NKT A/S's long position.| Hyster-Yale Materials vs. Superior Plus Corp | Hyster-Yale Materials vs. NMI Holdings | Hyster-Yale Materials vs. Origin Agritech | Hyster-Yale Materials vs. SIVERS SEMICONDUCTORS AB |
| NKT A/S vs. PennantPark Investment | NKT A/S vs. Warner Music Group | NKT A/S vs. COMMERCIAL VEHICLE | NKT A/S vs. Mitsui Chemicals |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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