Correlation Between Loop Industries and Hurco Companies
Can any of the company-specific risk be diversified away by investing in both Loop Industries and Hurco Companies 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 Loop Industries and Hurco Companies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Loop Industries and Hurco Companies, you can compare the effects of market volatilities on Loop Industries and Hurco Companies 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 Loop Industries with a short position of Hurco Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loop Industries and Hurco Companies.
Diversification Opportunities for Loop Industries and Hurco Companies
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Loop and Hurco is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Loop Industries and Hurco Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hurco Companies and Loop Industries 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 Loop Industries are associated (or correlated) with Hurco Companies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hurco Companies has no effect on the direction of Loop Industries i.e., Loop Industries and Hurco Companies go up and down completely randomly.
Pair Corralation between Loop Industries and Hurco Companies
Given the investment horizon of 90 days Loop Industries is expected to under-perform the Hurco Companies. In addition to that, Loop Industries is 2.17 times more volatile than Hurco Companies. It trades about 0.0 of its total potential returns per unit of risk. Hurco Companies is currently generating about 0.01 per unit of volatility. If you would invest 2,401 in Hurco Companies on August 26, 2024 and sell it today you would lose (135.00) from holding Hurco Companies or give up 5.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Loop Industries vs. Hurco Companies
Performance |
| Timeline |
| Loop Industries |
| Hurco Companies |
Loop Industries and Hurco Companies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loop Industries and Hurco Companies
The main advantage of trading using opposite Loop Industries and Hurco Companies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loop Industries position performs unexpectedly, Hurco Companies 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 Hurco Companies will offset losses from the drop in Hurco Companies' long position.| Loop Industries vs. H B Fuller | Loop Industries vs. Element Solutions | Loop Industries vs. Innospec | Loop Industries vs. Cabot |
| Hurco Companies vs. Enerpac Tool Group | Hurco Companies vs. Enpro Industries | Hurco Companies vs. Omega Flex | Hurco Companies vs. Gorman Rupp |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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