Correlation Between Lindsay and Hyster Yale
Can any of the company-specific risk be diversified away by investing in both Lindsay and Hyster Yale 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 Lindsay and Hyster Yale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lindsay and Hyster Yale Materials Handling, you can compare the effects of market volatilities on Lindsay and Hyster Yale 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 Lindsay with a short position of Hyster Yale. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lindsay and Hyster Yale.
Diversification Opportunities for Lindsay and Hyster Yale
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lindsay and Hyster is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Lindsay and Hyster Yale Materials Handling in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyster Yale Materials and Lindsay 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 Lindsay are associated (or correlated) with Hyster Yale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyster Yale Materials has no effect on the direction of Lindsay i.e., Lindsay and Hyster Yale go up and down completely randomly.
Pair Corralation between Lindsay and Hyster Yale
Considering the 90-day investment horizon Lindsay is expected to generate 1.54 times less return on investment than Hyster Yale. But when comparing it to its historical volatility, Lindsay is 1.37 times less risky than Hyster Yale. It trades about 0.02 of its potential returns per unit of risk. Hyster Yale Materials Handling is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 5,168 in Hyster Yale Materials Handling on August 27, 2024 and sell it today you would earn a total of 511.00 from holding Hyster Yale Materials Handling or generate 9.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lindsay vs. Hyster Yale Materials Handling
Performance |
| Timeline |
| Lindsay |
| Hyster Yale Materials |
Lindsay and Hyster Yale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lindsay and Hyster Yale
The main advantage of trading using opposite Lindsay and Hyster Yale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lindsay position performs unexpectedly, Hyster Yale 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 Hyster Yale will offset losses from the drop in Hyster Yale's long position.| Lindsay vs. MYR Group | Lindsay vs. Granite Construction Incorporated | Lindsay vs. Construction Partners | Lindsay vs. Great Lakes Dredge |
| Hyster Yale vs. Xos Inc | Hyster Yale vs. Nikola Corp | Hyster Yale vs. Wabash National | Hyster Yale vs. American Premium Water |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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