Correlation Between Hudson Technologies and EPR Properties

Can any of the company-specific risk be diversified away by investing in both Hudson Technologies and EPR Properties 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 Hudson Technologies and EPR Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Hudson Technologies and EPR Properties 5750, you can compare the effects of market volatilities on Hudson Technologies and EPR Properties 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 Hudson Technologies with a short position of EPR Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hudson Technologies and EPR Properties.

Diversification Opportunities for Hudson Technologies and EPR Properties

0.39

Correlation Coefficient

Hudson Technologies  EPR Properties

Weak diversification

The 3 months correlation between Hudson and EPR is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Hudson Technologies and EPR Properties 5750 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EPR Properties 5750 and Hudson Technologies 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 Hudson Technologies are associated (or correlated) with EPR Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EPR Properties 5750 has no effect on the direction of Hudson Technologies i.e., Hudson Technologies and EPR Properties go up and down completely randomly.

Pair Corralation between Hudson Technologies and EPR Properties

Given the investment horizon of 90 days Hudson Technologies is expected to generate 1.56 times more return on investment than EPR Properties. However, Hudson Technologies is 1.56 times more volatile than EPR Properties 5750. It trades about -0.15 of its potential returns per unit of risk. EPR Properties 5750 is currently generating about -0.49 per unit of risk. If you would invest  598.00  in Hudson Technologies on October 4, 2024 and sell it today you would lose (29.00) from holding Hudson Technologies or give up 4.85% of portfolio value over 90 days.

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

Hudson Technologies  vs.  EPR Properties 5750

Hudson Technologies

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hudson Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in February 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

EPR Properties 5750

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days EPR Properties 5750 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Preferred 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 Hudson Technologies and EPR Properties

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

The idea behind Hudson Technologies and EPR Properties 5750 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.