Correlation Between Helios Technologies and Chart Industries

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Can any of the company-specific risk be diversified away by investing in both Helios Technologies and Chart Industries 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 Helios Technologies and Chart Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Helios Technologies and Chart Industries, you can compare the effects of market volatilities on Helios Technologies and Chart Industries 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 Helios Technologies with a short position of Chart Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Helios Technologies and Chart Industries.

Diversification Opportunities for Helios Technologies and Chart Industries

0.35
  Correlation Coefficient

Weak diversification

The 3 months correlation between Helios and Chart is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Helios Technologies and Chart Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chart Industries and Helios 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 Helios Technologies are associated (or correlated) with Chart Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chart Industries has no effect on the direction of Helios Technologies i.e., Helios Technologies and Chart Industries go up and down completely randomly.

Pair Corralation between Helios Technologies and Chart Industries

Given the investment horizon of 90 days Helios Technologies is expected to under-perform the Chart Industries. But the stock apears to be less risky and, when comparing its historical volatility, Helios Technologies is 1.39 times less risky than Chart Industries. The stock trades about -0.49 of its potential returns per unit of risk. The Chart Industries is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest  19,060  in Chart Industries on October 6, 2024 and sell it today you would earn a total of  836.00  from holding Chart Industries or generate 4.39% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Helios Technologies  vs.  Chart Industries

 Performance 
       Timeline  
Helios Technologies 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Helios Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy forward indicators, Helios Technologies is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.
Chart Industries 

Risk-Adjusted Performance

21 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Chart Industries are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain essential indicators, Chart Industries unveiled solid returns over the last few months and may actually be approaching a breakup point.

Helios Technologies and Chart Industries Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Helios Technologies and Chart Industries

The main advantage of trading using opposite Helios Technologies and Chart Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Helios Technologies position performs unexpectedly, Chart Industries 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 Chart Industries will offset losses from the drop in Chart Industries' long position.
The idea behind Helios Technologies and Chart Industries 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.
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 Global Correlations module to find global opportunities by holding instruments from different markets.

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