Correlation Between Shyft and Manitowoc
Can any of the company-specific risk be diversified away by investing in both Shyft and Manitowoc 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 Shyft and Manitowoc into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shyft Group and Manitowoc, you can compare the effects of market volatilities on Shyft and Manitowoc 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 Shyft with a short position of Manitowoc. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shyft and Manitowoc.
Diversification Opportunities for Shyft and Manitowoc
Very poor diversification
The 3 months correlation between Shyft and Manitowoc is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Shyft Group and Manitowoc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manitowoc and Shyft 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 Shyft Group are associated (or correlated) with Manitowoc. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manitowoc has no effect on the direction of Shyft i.e., Shyft and Manitowoc go up and down completely randomly.
Pair Corralation between Shyft and Manitowoc
Given the investment horizon of 90 days Shyft Group is expected to under-perform the Manitowoc. In addition to that, Shyft is 1.19 times more volatile than Manitowoc. It trades about -0.02 of its total potential returns per unit of risk. Manitowoc is currently generating about 0.08 per unit of volatility. If you would invest 890.00 in Manitowoc on November 1, 2024 and sell it today you would earn a total of 116.00 from holding Manitowoc or generate 13.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shyft Group vs. Manitowoc
Performance |
| Timeline |
| Shyft Group |
| Manitowoc |
Shyft and Manitowoc Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shyft and Manitowoc
The main advantage of trading using opposite Shyft and Manitowoc positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shyft position performs unexpectedly, Manitowoc 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 Manitowoc will offset losses from the drop in Manitowoc's long position.| Shyft vs. Astec Industries | Shyft vs. Hyster Yale Materials Handling | Shyft vs. Rev Group | Shyft vs. Lindsay |
| Manitowoc vs. Oshkosh | Manitowoc vs. Alamo Group | Manitowoc vs. Wabash National | Manitowoc vs. Hyster Yale Materials Handling |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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