Correlation Between Hurco Companies and INGERSOLL

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

By analyzing existing cross correlation between Hurco Companies and INGERSOLL RAND GLOBAL HLDG, you can compare the effects of market volatilities on Hurco Companies and INGERSOLL 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 INGERSOLL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hurco Companies and INGERSOLL.

Diversification Opportunities for Hurco Companies and INGERSOLL

0.34

Correlation Coefficient

Hurco Companies  INGERSOLL

Weak diversification

The 3 months correlation between Hurco and INGERSOLL is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Hurco Companies and INGERSOLL RAND GLOBAL HLDG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INGERSOLL RAND GLOBAL 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 INGERSOLL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INGERSOLL RAND GLOBAL has no effect on the direction of Hurco Companies i.e., Hurco Companies and INGERSOLL go up and down completely randomly.

Pair Corralation between Hurco Companies and INGERSOLL

Given the investment horizon of 90 days Hurco Companies is expected to under-perform the INGERSOLL. In addition to that, Hurco Companies is 1.57 times more volatile than INGERSOLL RAND GLOBAL HLDG. It trades about -0.16 of its total potential returns per unit of risk. INGERSOLL RAND GLOBAL HLDG is currently generating about 0.03 per unit of volatility. If you would invest  8,521  in INGERSOLL RAND GLOBAL HLDG on September 19, 2024 and sell it today you would earn a total of  39.00  from holding INGERSOLL RAND GLOBAL HLDG or generate 0.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	61.9%
Values	Daily Returns

Hurco Companies  vs.  INGERSOLL RAND GLOBAL HLDG

Hurco Companies

Risk-Adjusted Performance

1 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Hurco Companies are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, Hurco Companies is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

INGERSOLL RAND GLOBAL

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days INGERSOLL RAND GLOBAL HLDG has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, INGERSOLL 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 INGERSOLL

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

The idea behind Hurco Companies and INGERSOLL RAND GLOBAL HLDG 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.