Correlation Between Rocky Brands and Alta Equipment
Can any of the company-specific risk be diversified away by investing in both Rocky Brands and Alta Equipment 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 Rocky Brands and Alta Equipment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Rocky Brands and Alta Equipment Group, you can compare the effects of market volatilities on Rocky Brands and Alta Equipment 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 Rocky Brands with a short position of Alta Equipment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rocky Brands and Alta Equipment.
Diversification Opportunities for Rocky Brands and Alta Equipment
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Rocky and Alta is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Rocky Brands and Alta Equipment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alta Equipment Group and Rocky Brands 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 Rocky Brands are associated (or correlated) with Alta Equipment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alta Equipment Group has no effect on the direction of Rocky Brands i.e., Rocky Brands and Alta Equipment go up and down completely randomly.
Pair Corralation between Rocky Brands and Alta Equipment
Given the investment horizon of 90 days Rocky Brands is expected to under-perform the Alta Equipment. In addition to that, Rocky Brands is 1.21 times more volatile than Alta Equipment Group. It trades about -0.11 of its total potential returns per unit of risk. Alta Equipment Group is currently generating about 0.2 per unit of volatility. If you would invest 665.00 in Alta Equipment Group on August 28, 2024 and sell it today you would earn a total of 147.00 from holding Alta Equipment Group or generate 22.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rocky Brands vs. Alta Equipment Group
Performance |
| Timeline |
| Rocky Brands |
| Alta Equipment Group |
Rocky Brands and Alta Equipment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rocky Brands and Alta Equipment
The main advantage of trading using opposite Rocky Brands and Alta Equipment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rocky Brands position performs unexpectedly, Alta Equipment 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 Alta Equipment will offset losses from the drop in Alta Equipment's long position.| Rocky Brands vs. Vera Bradley | Rocky Brands vs. Steven Madden | Rocky Brands vs. Wolverine World Wide | Rocky Brands vs. Caleres |
| Alta Equipment vs. PROG Holdings | Alta Equipment vs. McGrath RentCorp | Alta Equipment vs. Mega Matrix Corp | Alta Equipment vs. FTAI Aviation Ltd |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Commodity Directory Find actively traded commodities issued by global exchanges |