Correlation Between Manitowoc and Shyft
Can any of the company-specific risk be diversified away by investing in both Manitowoc and Shyft 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 Manitowoc and Shyft into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Manitowoc and Shyft Group, you can compare the effects of market volatilities on Manitowoc and Shyft 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 Manitowoc with a short position of Shyft. Check out your portfolio center. Please also check ongoing floating volatility patterns of Manitowoc and Shyft.
Diversification Opportunities for Manitowoc and Shyft
Poor diversification
The 3 months correlation between Manitowoc and Shyft is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Manitowoc and Shyft Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shyft Group and Manitowoc 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 Manitowoc are associated (or correlated) with Shyft. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shyft Group has no effect on the direction of Manitowoc i.e., Manitowoc and Shyft go up and down completely randomly.
Pair Corralation between Manitowoc and Shyft
Considering the 90-day investment horizon Manitowoc is expected to generate 2.1 times more return on investment than Shyft. However, Manitowoc is 2.1 times more volatile than Shyft Group. It trades about 0.09 of its potential returns per unit of risk. Shyft Group is currently generating about 0.14 per unit of risk. If you would invest 1,005 in Manitowoc on August 27, 2024 and sell it today you would earn a total of 76.00 from holding Manitowoc or generate 7.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Manitowoc vs. Shyft Group
Performance |
| Timeline |
| Manitowoc |
| Shyft Group |
Manitowoc and Shyft Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Manitowoc and Shyft
The main advantage of trading using opposite Manitowoc and Shyft positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Manitowoc position performs unexpectedly, Shyft 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 Shyft will offset losses from the drop in Shyft's long position.| Manitowoc vs. Oshkosh | Manitowoc vs. Alamo Group | Manitowoc vs. Wabash National | Manitowoc vs. Hyster Yale Materials Handling |
| Shyft vs. Astec Industries | Shyft vs. Hyster Yale Materials Handling | Shyft vs. Manitex International | Shyft vs. Rev Group |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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