Correlation Between H B and Fuchs Petrolub

Can any of the company-specific risk be diversified away by investing in both H B and Fuchs Petrolub 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 H B and Fuchs Petrolub into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between H B Fuller and Fuchs Petrolub SE, you can compare the effects of market volatilities on H B and Fuchs Petrolub 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 H B with a short position of Fuchs Petrolub. Check out your portfolio center. Please also check ongoing floating volatility patterns of H B and Fuchs Petrolub.

Diversification Opportunities for H B and Fuchs Petrolub

-0.83

Correlation Coefficient

H B  Fuchs Petrolub

Pay attention - limited upside

The 3 months correlation between FUL and Fuchs is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding H B Fuller and Fuchs Petrolub SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fuchs Petrolub SE and H B 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 H B Fuller are associated (or correlated) with Fuchs Petrolub. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fuchs Petrolub SE has no effect on the direction of H B i.e., H B and Fuchs Petrolub go up and down completely randomly.

Pair Corralation between H B and Fuchs Petrolub

Considering the 90-day investment horizon H B Fuller is expected to under-perform the Fuchs Petrolub. But the stock apears to be less risky and, when comparing its historical volatility, H B Fuller is 1.37 times less risky than Fuchs Petrolub. The stock trades about -0.21 of its potential returns per unit of risk. The Fuchs Petrolub SE is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest  1,081  in Fuchs Petrolub SE on December 27, 2024 and sell it today you would earn a total of  170.00  from holding Fuchs Petrolub SE or generate 15.73% return on investment over 90 days.

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

H B Fuller  vs.  Fuchs Petrolub SE

H B Fuller

Risk-Adjusted Performance

Very Weak

Over the last 90 days H B Fuller has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in April 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Fuchs Petrolub SE

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Fuchs Petrolub SE are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak fundamental drivers, Fuchs Petrolub showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with H B and Fuchs Petrolub

The main advantage of trading using opposite H B and Fuchs Petrolub positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if H B position performs unexpectedly, Fuchs Petrolub 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 Fuchs Petrolub will offset losses from the drop in Fuchs Petrolub's long position.

The idea behind H B Fuller and Fuchs Petrolub SE 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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.