Correlation Between Parker Hannifin and Helios Technologies
Can any of the company-specific risk be diversified away by investing in both Parker Hannifin and Helios Technologies 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 Parker Hannifin and Helios Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Parker Hannifin and Helios Technologies, you can compare the effects of market volatilities on Parker Hannifin and Helios Technologies 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 Parker Hannifin with a short position of Helios Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Parker Hannifin and Helios Technologies.
Diversification Opportunities for Parker Hannifin and Helios Technologies
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Parker and Helios is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Parker Hannifin and Helios Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Helios Technologies and Parker Hannifin 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 Parker Hannifin are associated (or correlated) with Helios Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Helios Technologies has no effect on the direction of Parker Hannifin i.e., Parker Hannifin and Helios Technologies go up and down completely randomly.
Pair Corralation between Parker Hannifin and Helios Technologies
Allowing for the 90-day total investment horizon Parker Hannifin is expected to generate 0.9 times more return on investment than Helios Technologies. However, Parker Hannifin is 1.11 times less risky than Helios Technologies. It trades about 0.31 of its potential returns per unit of risk. Helios Technologies is currently generating about 0.03 per unit of risk. If you would invest 63,603 in Parker Hannifin on November 1, 2024 and sell it today you would earn a total of 6,973 from holding Parker Hannifin or generate 10.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Parker Hannifin vs. Helios Technologies
Performance |
| Timeline |
| Parker Hannifin |
| Helios Technologies |
Parker Hannifin and Helios Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Parker Hannifin and Helios Technologies
The main advantage of trading using opposite Parker Hannifin and Helios Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Parker Hannifin position performs unexpectedly, Helios Technologies 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 Helios Technologies will offset losses from the drop in Helios Technologies' long position.| Parker Hannifin vs. Illinois Tool Works | Parker Hannifin vs. Pentair PLC | Parker Hannifin vs. Emerson Electric | Parker Hannifin vs. Smith AO |
| Helios Technologies vs. Enpro Industries | Helios Technologies vs. Omega Flex | Helios Technologies vs. Luxfer Holdings PLC | Helios Technologies vs. Hurco Companies |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |