Correlation Between Hyster-Yale Materials and Waste Connections
Can any of the company-specific risk be diversified away by investing in both Hyster-Yale Materials and Waste Connections 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 Waste Connections 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 Waste Connections, you can compare the effects of market volatilities on Hyster-Yale Materials and Waste Connections 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 Waste Connections. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyster-Yale Materials and Waste Connections.
Diversification Opportunities for Hyster-Yale Materials and Waste Connections
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hyster-Yale and Waste is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Hyster Yale Materials Handling and Waste Connections in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Waste Connections 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 Waste Connections. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Waste Connections has no effect on the direction of Hyster-Yale Materials i.e., Hyster-Yale Materials and Waste Connections go up and down completely randomly.
Pair Corralation between Hyster-Yale Materials and Waste Connections
Assuming the 90 days trading horizon Hyster Yale Materials Handling is expected to generate 3.1 times more return on investment than Waste Connections. However, Hyster-Yale Materials is 3.1 times more volatile than Waste Connections. It trades about 0.06 of its potential returns per unit of risk. Waste Connections is currently generating about 0.07 per unit of risk. If you would invest 2,531 in Hyster Yale Materials Handling on September 5, 2024 and sell it today you would earn a total of 2,719 from holding Hyster Yale Materials Handling or generate 107.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Hyster Yale Materials Handling vs. Waste Connections
Performance |
| Timeline |
| Hyster Yale Materials |
| Waste Connections |
Hyster-Yale Materials and Waste Connections Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyster-Yale Materials and Waste Connections
The main advantage of trading using opposite Hyster-Yale Materials and Waste Connections positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyster-Yale Materials position performs unexpectedly, Waste Connections 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 Waste Connections will offset losses from the drop in Waste Connections' 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 |
| Waste Connections vs. Westlake Chemical | Waste Connections vs. SEKISUI CHEMICAL | Waste Connections vs. Hyster Yale Materials Handling | Waste Connections vs. Goodyear Tire Rubber |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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