Correlation Between Oshkosh and GreenPower
Can any of the company-specific risk be diversified away by investing in both Oshkosh and GreenPower 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 Oshkosh and GreenPower into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oshkosh and GreenPower Motor, you can compare the effects of market volatilities on Oshkosh and GreenPower 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 Oshkosh with a short position of GreenPower. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oshkosh and GreenPower.
Diversification Opportunities for Oshkosh and GreenPower
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Oshkosh and GreenPower is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Oshkosh and GreenPower Motor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GreenPower Motor and Oshkosh 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 Oshkosh are associated (or correlated) with GreenPower. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GreenPower Motor has no effect on the direction of Oshkosh i.e., Oshkosh and GreenPower go up and down completely randomly.
Pair Corralation between Oshkosh and GreenPower
Considering the 90-day investment horizon Oshkosh is expected to generate 0.53 times more return on investment than GreenPower. However, Oshkosh is 1.88 times less risky than GreenPower. It trades about 0.08 of its potential returns per unit of risk. GreenPower Motor is currently generating about -0.23 per unit of risk. If you would invest 10,957 in Oshkosh on August 28, 2024 and sell it today you would earn a total of 457.00 from holding Oshkosh or generate 4.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Oshkosh vs. GreenPower Motor
Performance |
| Timeline |
| Oshkosh |
| GreenPower Motor |
Oshkosh and GreenPower Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oshkosh and GreenPower
The main advantage of trading using opposite Oshkosh and GreenPower positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oshkosh position performs unexpectedly, GreenPower 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 GreenPower will offset losses from the drop in GreenPower's long position.| Oshkosh vs. Terex | Oshkosh vs. Astec Industries | Oshkosh vs. Hyster Yale Materials Handling | Oshkosh vs. Manitex International |
| GreenPower vs. Lion Electric Corp | GreenPower vs. Xos Inc | GreenPower vs. Hydrofarm Holdings Group | GreenPower vs. AGCO Corporation |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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