Correlation Between Wabash National and Hyster-Yale Materials
Can any of the company-specific risk be diversified away by investing in both Wabash National and Hyster-Yale Materials 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 Wabash National and Hyster-Yale Materials into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wabash National and Hyster Yale Materials Handling, you can compare the effects of market volatilities on Wabash National and Hyster-Yale Materials 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 Wabash National with a short position of Hyster-Yale Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wabash National and Hyster-Yale Materials.
Diversification Opportunities for Wabash National and Hyster-Yale Materials
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Wabash and Hyster-Yale is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Wabash National 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 Wabash National 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 Wabash National are associated (or correlated) with Hyster-Yale Materials. 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 Wabash National i.e., Wabash National and Hyster-Yale Materials go up and down completely randomly.
Pair Corralation between Wabash National and Hyster-Yale Materials
Assuming the 90 days horizon Wabash National is expected to generate 0.61 times more return on investment than Hyster-Yale Materials. However, Wabash National is 1.64 times less risky than Hyster-Yale Materials. It trades about 0.27 of its potential returns per unit of risk. Hyster Yale Materials Handling is currently generating about -0.12 per unit of risk. If you would invest 1,660 in Wabash National on August 29, 2024 and sell it today you would earn a total of 250.00 from holding Wabash National or generate 15.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wabash National vs. Hyster Yale Materials Handling
Performance |
| Timeline |
| Wabash National |
| Hyster Yale Materials |
Wabash National and Hyster-Yale Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wabash National and Hyster-Yale Materials
The main advantage of trading using opposite Wabash National and Hyster-Yale Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wabash National position performs unexpectedly, Hyster-Yale Materials 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 Materials will offset losses from the drop in Hyster-Yale Materials' long position.| Wabash National vs. KION Group AG | Wabash National vs. Hyster Yale Materials Handling | Wabash National vs. Superior Plus Corp | Wabash National vs. NMI Holdings |
| Hyster-Yale Materials vs. KION Group AG | Hyster-Yale Materials vs. Superior Plus Corp | Hyster-Yale Materials vs. NMI Holdings | Hyster-Yale Materials vs. Origin Agritech |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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