Correlation Between Hyster Yale and National Health
Can any of the company-specific risk be diversified away by investing in both Hyster Yale and National Health 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 National Health 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 National Health Investors, you can compare the effects of market volatilities on Hyster Yale and National Health 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 National Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyster Yale and National Health.
Diversification Opportunities for Hyster Yale and National Health
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hyster and National is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Hyster Yale Materials Handling and National Health Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Health Investors 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 National Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Health Investors has no effect on the direction of Hyster Yale i.e., Hyster Yale and National Health go up and down completely randomly.
Pair Corralation between Hyster Yale and National Health
Assuming the 90 days trading horizon Hyster Yale Materials Handling is expected to generate 2.19 times more return on investment than National Health. However, Hyster Yale is 2.19 times more volatile than National Health Investors. It trades about -0.09 of its potential returns per unit of risk. National Health Investors is currently generating about -0.51 per unit of risk. If you would invest 5,017 in Hyster Yale Materials Handling on September 22, 2024 and sell it today you would lose (217.00) from holding Hyster Yale Materials Handling or give up 4.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hyster Yale Materials Handling vs. National Health Investors
Performance |
| Timeline |
| Hyster Yale Materials |
| National Health Investors |
Hyster Yale and National Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hyster Yale and National Health
The main advantage of trading using opposite Hyster Yale and National Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hyster Yale position performs unexpectedly, National Health 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 National Health will offset losses from the drop in National Health's long position.The idea behind Hyster Yale Materials Handling and National Health Investors pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| National Health vs. Schweizer Electronic AG | National Health vs. SIDETRADE EO 1 | National Health vs. ARROW ELECTRONICS | National Health vs. American Eagle Outfitters |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |