Correlation Between Groupama Entreprises and Hyster-Yale Materials

Can any of the company-specific risk be diversified away by investing in both Groupama Entreprises 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 Groupama Entreprises 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 Groupama Entreprises N and Hyster Yale Materials Handling, you can compare the effects of market volatilities on Groupama Entreprises 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 Groupama Entreprises with a short position of Hyster-Yale Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Groupama Entreprises and Hyster-Yale Materials.

Diversification Opportunities for Groupama Entreprises and Hyster-Yale Materials

-0.68

Correlation Coefficient

Groupama Entreprises  Hyster-Yale Materials

Excellent diversification

The 3 months correlation between Groupama and Hyster-Yale is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Groupama Entreprises N 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 Groupama Entreprises 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 Groupama Entreprises N 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 Groupama Entreprises i.e., Groupama Entreprises and Hyster-Yale Materials go up and down completely randomly.

Pair Corralation between Groupama Entreprises and Hyster-Yale Materials

Assuming the 90 days trading horizon Groupama Entreprises N is expected to generate 0.0 times more return on investment than Hyster-Yale Materials. However, Groupama Entreprises N is 235.6 times less risky than Hyster-Yale Materials. It trades about 0.94 of its potential returns per unit of risk. Hyster Yale Materials Handling is currently generating about -0.1 per unit of risk. If you would invest  59,029  in Groupama Entreprises N on October 5, 2024 and sell it today you would earn a total of  423.00  from holding Groupama Entreprises N or generate 0.72% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Groupama Entreprises N  vs.  Hyster Yale Materials Handling

Groupama Entreprises

Risk-Adjusted Performance

0 of 100

Market Crasher

Over the last 90 days Groupama Entreprises N has generated negative risk-adjusted returns adding no value to fund investors. Despite somewhat strong basic indicators, Groupama Entreprises is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Hyster Yale Materials

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hyster Yale Materials Handling has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Groupama Entreprises and Hyster-Yale Materials

The main advantage of trading using opposite Groupama Entreprises and Hyster-Yale Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Groupama Entreprises 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.

The idea behind Groupama Entreprises N and Hyster Yale Materials Handling pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.