Correlation Between Mativ Holdings and Hurco Companies

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

Diversification Opportunities for Mativ Holdings and Hurco Companies

-0.3
  Correlation Coefficient

Very good diversification

The 3 months correlation between Mativ and Hurco is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Mativ Holdings and Hurco Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hurco Companies and Mativ Holdings 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 Mativ Holdings are associated (or correlated) with Hurco Companies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hurco Companies has no effect on the direction of Mativ Holdings i.e., Mativ Holdings and Hurco Companies go up and down completely randomly.

Pair Corralation between Mativ Holdings and Hurco Companies

Given the investment horizon of 90 days Mativ Holdings is expected to generate 1.26 times more return on investment than Hurco Companies. However, Mativ Holdings is 1.26 times more volatile than Hurco Companies. It trades about -0.23 of its potential returns per unit of risk. Hurco Companies is currently generating about -0.37 per unit of risk. If you would invest  1,309  in Mativ Holdings on September 23, 2024 and sell it today you would lose (163.00) from holding Mativ Holdings or give up 12.45% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Mativ Holdings  vs.  Hurco Companies

 Performance 
       Timeline  
Mativ Holdings 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Mativ Holdings 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 fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.
Hurco Companies 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Hurco Companies are ranked lower than 2 (%) 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 current stock price tumult, may contribute to shorter-term losses for the shareholders.

Mativ Holdings and Hurco Companies Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Mativ Holdings and Hurco Companies

The main advantage of trading using opposite Mativ Holdings and Hurco Companies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mativ Holdings position performs unexpectedly, Hurco Companies 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 Hurco Companies will offset losses from the drop in Hurco Companies' long position.
The idea behind Mativ Holdings and Hurco Companies 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..

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