Correlation Between Park Ohio and U Blox
Can any of the company-specific risk be diversified away by investing in both Park Ohio and U Blox 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 Park Ohio and U Blox into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Park Ohio Holdings and u blox Holding AG, you can compare the effects of market volatilities on Park Ohio and U Blox 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 Park Ohio with a short position of U Blox. Check out your portfolio center. Please also check ongoing floating volatility patterns of Park Ohio and U Blox.
Diversification Opportunities for Park Ohio and U Blox
Excellent diversification
The 3 months correlation between Park and UBLXF is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Park Ohio Holdings and u blox Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on u blox Holding and Park Ohio 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 Park Ohio Holdings are associated (or correlated) with U Blox. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of u blox Holding has no effect on the direction of Park Ohio i.e., Park Ohio and U Blox go up and down completely randomly.
Pair Corralation between Park Ohio and U Blox
Given the investment horizon of 90 days Park Ohio Holdings is expected to under-perform the U Blox. But the stock apears to be less risky and, when comparing its historical volatility, Park Ohio Holdings is 2.4 times less risky than U Blox. The stock trades about -0.11 of its potential returns per unit of risk. The u blox Holding AG is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 7,986 in u blox Holding AG on September 13, 2024 and sell it today you would earn a total of 9.00 from holding u blox Holding AG or generate 0.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Park Ohio Holdings vs. u blox Holding AG
Performance |
| Timeline |
| Park Ohio Holdings |
| u blox Holding |
Park Ohio and U Blox Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Park Ohio and U Blox
The main advantage of trading using opposite Park Ohio and U Blox positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Park Ohio position performs unexpectedly, U Blox 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 U Blox will offset losses from the drop in U Blox's long position.| Park Ohio vs. Hurco Companies | Park Ohio vs. Enerpac Tool Group | Park Ohio vs. China Yuchai International | Park Ohio vs. Luxfer Holdings PLC |
| U Blox vs. Acco Brands | U Blox vs. Four Seasons Education | U Blox vs. Weyco Group | U Blox vs. Daily Journal Corp |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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