Correlation Between Sypris Solutions and Gentex
Can any of the company-specific risk be diversified away by investing in both Sypris Solutions and Gentex 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 Sypris Solutions and Gentex into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sypris Solutions and Gentex, you can compare the effects of market volatilities on Sypris Solutions and Gentex 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 Sypris Solutions with a short position of Gentex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sypris Solutions and Gentex.
Diversification Opportunities for Sypris Solutions and Gentex
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sypris and Gentex is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Sypris Solutions and Gentex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gentex and Sypris Solutions 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 Sypris Solutions are associated (or correlated) with Gentex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gentex has no effect on the direction of Sypris Solutions i.e., Sypris Solutions and Gentex go up and down completely randomly.
Pair Corralation between Sypris Solutions and Gentex
Given the investment horizon of 90 days Sypris Solutions is expected to under-perform the Gentex. In addition to that, Sypris Solutions is 1.39 times more volatile than Gentex. It trades about -0.03 of its total potential returns per unit of risk. Gentex is currently generating about -0.02 per unit of volatility. If you would invest 3,130 in Gentex on August 28, 2024 and sell it today you would lose (22.00) from holding Gentex or give up 0.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sypris Solutions vs. Gentex
Performance |
| Timeline |
| Sypris Solutions |
| Gentex |
Sypris Solutions and Gentex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sypris Solutions and Gentex
The main advantage of trading using opposite Sypris Solutions and Gentex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sypris Solutions position performs unexpectedly, Gentex 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 Gentex will offset losses from the drop in Gentex's long position.| Sypris Solutions vs. Monro Muffler Brake | Sypris Solutions vs. Magna International | Sypris Solutions vs. BorgWarner | Sypris Solutions vs. Mobileye Global Class |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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