Correlation Between Hyster Yale and Oshkosh

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

By analyzing existing cross correlation between Hyster Yale Materials Handling and Oshkosh, you can compare the effects of market volatilities on Hyster Yale and Oshkosh 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 Hyster Yale with a short position of Oshkosh. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hyster Yale and Oshkosh.

Diversification Opportunities for Hyster Yale and Oshkosh

-0.39

Correlation Coefficient

Hyster Yale  Oshkosh

Very good diversification

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

Pair Corralation between Hyster Yale and Oshkosh

Allowing for the 90-day total investment horizon Hyster Yale Materials Handling is expected to under-perform the Oshkosh. In addition to that, Hyster Yale is 1.29 times more volatile than Oshkosh. It trades about -0.05 of its total potential returns per unit of risk. Oshkosh is currently generating about 0.05 per unit of volatility. If you would invest  10,747  in Oshkosh on August 30, 2024 and sell it today you would earn a total of  530.00  from holding Oshkosh or generate 4.93% return on investment over 90 days.

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

Hyster Yale Materials Handling  vs.  Oshkosh

Hyster Yale Materials

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hyster Yale Materials Handling has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Oshkosh

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Oshkosh are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent basic indicators, Oshkosh is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Hyster Yale and Oshkosh

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

The idea behind Hyster Yale Materials Handling and Oshkosh 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 Stocks Directory module to find actively traded stocks across global markets.