Correlation Between Vulcan Materials and Hyster Yale
Can any of the company-specific risk be diversified away by investing in both Vulcan Materials and Hyster Yale 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 Vulcan Materials and Hyster Yale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vulcan Materials and Hyster Yale Materials Handling, you can compare the effects of market volatilities on Vulcan Materials and Hyster Yale 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 Vulcan Materials with a short position of Hyster Yale. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vulcan Materials and Hyster Yale.
Diversification Opportunities for Vulcan Materials and Hyster Yale
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Vulcan and Hyster is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Vulcan Materials and Hyster Yale Materials Handling in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyster Yale Materials and Vulcan Materials 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 Vulcan Materials are associated (or correlated) with Hyster Yale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyster Yale Materials has no effect on the direction of Vulcan Materials i.e., Vulcan Materials and Hyster Yale go up and down completely randomly.
Pair Corralation between Vulcan Materials and Hyster Yale
Assuming the 90 days horizon Vulcan Materials is expected to under-perform the Hyster Yale. But the stock apears to be less risky and, when comparing its historical volatility, Vulcan Materials is 1.76 times less risky than Hyster Yale. The stock trades about -0.23 of its potential returns per unit of risk. The Hyster Yale Materials Handling is currently generating about -0.09 of returns per unit of risk over similar time horizon. If you would invest 5,017 in Hyster Yale Materials Handling on September 22, 2024 and sell it today you would lose (217.00) from holding Hyster Yale Materials Handling or give up 4.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Vulcan Materials vs. Hyster Yale Materials Handling
Performance |
| Timeline |
| Vulcan Materials |
| Hyster Yale Materials |
Vulcan Materials and Hyster Yale Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vulcan Materials and Hyster Yale
The main advantage of trading using opposite Vulcan Materials and Hyster Yale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vulcan Materials position performs unexpectedly, Hyster Yale 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 Hyster Yale will offset losses from the drop in Hyster Yale's long position.| Vulcan Materials vs. Check Point Software | Vulcan Materials vs. Natural Health Trends | Vulcan Materials vs. UPDATE SOFTWARE | Vulcan Materials vs. Sabra Health Care |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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