Correlation Between Textainer Group and Alamo
Can any of the company-specific risk be diversified away by investing in both Textainer Group and Alamo 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 Textainer Group and Alamo into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Textainer Group Holdings and Alamo Group, you can compare the effects of market volatilities on Textainer Group and Alamo 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 Textainer Group with a short position of Alamo. Check out your portfolio center. Please also check ongoing floating volatility patterns of Textainer Group and Alamo.
Diversification Opportunities for Textainer Group and Alamo
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Textainer and Alamo is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Textainer Group Holdings and Alamo Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alamo Group and Textainer Group 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 Textainer Group Holdings are associated (or correlated) with Alamo. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alamo Group has no effect on the direction of Textainer Group i.e., Textainer Group and Alamo go up and down completely randomly.
Pair Corralation between Textainer Group and Alamo
Assuming the 90 days horizon Textainer Group Holdings is expected to generate 1.87 times more return on investment than Alamo. However, Textainer Group is 1.87 times more volatile than Alamo Group. It trades about 0.06 of its potential returns per unit of risk. Alamo Group is currently generating about 0.04 per unit of risk. If you would invest 36.00 in Textainer Group Holdings on August 26, 2024 and sell it today you would earn a total of 37.00 from holding Textainer Group Holdings or generate 102.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Textainer Group Holdings vs. Alamo Group
Performance |
| Timeline |
| Textainer Group Holdings |
| Alamo Group |
Textainer Group and Alamo Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Textainer Group and Alamo
The main advantage of trading using opposite Textainer Group and Alamo positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Textainer Group position performs unexpectedly, Alamo 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 Alamo will offset losses from the drop in Alamo's long position.| Textainer Group vs. Buhler Industries | Textainer Group vs. Austin Engineering Limited | Textainer Group vs. Ag Growth International | Textainer Group vs. Grow Solutions Holdings |
| Alamo vs. Hyster Yale Materials Handling | Alamo vs. Columbus McKinnon | Alamo vs. AGCO Corporation | Alamo vs. Titan International |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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