Correlation Between Wabash National and Magplane Technology
Can any of the company-specific risk be diversified away by investing in both Wabash National and Magplane Technology 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 Magplane Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Wabash National and Magplane Technology, you can compare the effects of market volatilities on Wabash National and Magplane Technology 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 Magplane Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wabash National and Magplane Technology.
Diversification Opportunities for Wabash National and Magplane Technology
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Wabash and Magplane is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Wabash National and Magplane Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Magplane Technology 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 Magplane Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Magplane Technology has no effect on the direction of Wabash National i.e., Wabash National and Magplane Technology go up and down completely randomly.
Pair Corralation between Wabash National and Magplane Technology
If you would invest 0.01 in Magplane Technology on September 12, 2024 and sell it today you would earn a total of 0.00 from holding Magplane Technology or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wabash National vs. Magplane Technology
Performance |
| Timeline |
| Wabash National |
| Magplane Technology |
Wabash National and Magplane Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wabash National and Magplane Technology
The main advantage of trading using opposite Wabash National and Magplane Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wabash National position performs unexpectedly, Magplane Technology 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 Magplane Technology will offset losses from the drop in Magplane Technology's long position.| Wabash National vs. Manitowoc | Wabash National vs. Terex | Wabash National vs. Alamo Group | Wabash National vs. AGCO Corporation |
| Magplane Technology vs. SEI Investments | Magplane Technology vs. Mesa Air Group | Magplane Technology vs. Montauk Renewables | Magplane Technology vs. Sun Country Airlines |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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