Correlation Between ADRIATIC METALS and Hyster-Yale Materials

Can any of the company-specific risk be diversified away by investing in both ADRIATIC METALS 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 ADRIATIC METALS 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 ADRIATIC METALS LS 013355 and Hyster Yale Materials Handling, you can compare the effects of market volatilities on ADRIATIC METALS 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 ADRIATIC METALS with a short position of Hyster-Yale Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of ADRIATIC METALS and Hyster-Yale Materials.

Diversification Opportunities for ADRIATIC METALS and Hyster-Yale Materials

0.46

Correlation Coefficient

ADRIATIC METALS  Hyster-Yale Materials

Very weak diversification

The 3 months correlation between ADRIATIC and Hyster-Yale is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding ADRIATIC METALS LS 013355 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 ADRIATIC METALS 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 ADRIATIC METALS LS 013355 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 ADRIATIC METALS i.e., ADRIATIC METALS and Hyster-Yale Materials go up and down completely randomly.

Pair Corralation between ADRIATIC METALS and Hyster-Yale Materials

Assuming the 90 days trading horizon ADRIATIC METALS is expected to generate 1.46 times less return on investment than Hyster-Yale Materials. In addition to that, ADRIATIC METALS is 1.06 times more volatile than Hyster Yale Materials Handling. It trades about 0.03 of its total potential returns per unit of risk. Hyster Yale Materials Handling is currently generating about 0.05 per unit of volatility. If you would invest  2,852  in Hyster Yale Materials Handling on October 24, 2024 and sell it today you would earn a total of  2,248  from holding Hyster Yale Materials Handling or generate 78.82% return on investment over 90 days.

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

ADRIATIC METALS LS 013355  vs.  Hyster Yale Materials Handling

ADRIATIC METALS LS

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ADRIATIC METALS LS 013355 are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, ADRIATIC METALS may actually be approaching a critical reversion point that can send shares even higher in February 2025.

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 fragile 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 ADRIATIC METALS and Hyster-Yale Materials

The main advantage of trading using opposite ADRIATIC METALS and Hyster-Yale Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ADRIATIC METALS 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 ADRIATIC METALS LS 013355 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.