Correlation Between Hurco Companies and ALLSTATE

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

By analyzing existing cross correlation between Hurco Companies and ALLSTATE P 535, you can compare the effects of market volatilities on Hurco Companies and ALLSTATE 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 Hurco Companies with a short position of ALLSTATE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hurco Companies and ALLSTATE.

Diversification Opportunities for Hurco Companies and ALLSTATE

-0.31

Correlation Coefficient

Hurco Companies  ALLSTATE

Very good diversification

The 3 months correlation between Hurco and ALLSTATE is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Hurco Companies and ALLSTATE P 535 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALLSTATE P 535 and Hurco Companies 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 Hurco Companies are associated (or correlated) with ALLSTATE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALLSTATE P 535 has no effect on the direction of Hurco Companies i.e., Hurco Companies and ALLSTATE go up and down completely randomly.

Pair Corralation between Hurco Companies and ALLSTATE

Given the investment horizon of 90 days Hurco Companies is expected to under-perform the ALLSTATE. In addition to that, Hurco Companies is 4.22 times more volatile than ALLSTATE P 535. It trades about -0.06 of its total potential returns per unit of risk. ALLSTATE P 535 is currently generating about 0.01 per unit of volatility. If you would invest  10,031  in ALLSTATE P 535 on December 23, 2024 and sell it today you would earn a total of  12.00  from holding ALLSTATE P 535 or generate 0.12% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.08%
Values	Daily Returns

Hurco Companies  vs.  ALLSTATE P 535

Hurco Companies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hurco Companies has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

ALLSTATE P 535

Risk-Adjusted Performance

Very Weak

Over the last 90 days ALLSTATE P 535 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, ALLSTATE is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Hurco Companies and ALLSTATE

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

The idea behind Hurco Companies and ALLSTATE P 535 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..