Correlation Between Workhorse and Massimo Group

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

By analyzing existing cross correlation between Workhorse Group and Massimo Group Common, you can compare the effects of market volatilities on Workhorse and Massimo Group 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 Workhorse with a short position of Massimo Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Workhorse and Massimo Group.

Diversification Opportunities for Workhorse and Massimo Group

-0.41

Correlation Coefficient

Workhorse  Massimo Group

Very good diversification

The 3 months correlation between Workhorse and Massimo is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Workhorse Group and Massimo Group Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massimo Group Common and Workhorse 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 Workhorse Group are associated (or correlated) with Massimo Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Massimo Group Common has no effect on the direction of Workhorse i.e., Workhorse and Massimo Group go up and down completely randomly.

Pair Corralation between Workhorse and Massimo Group

Given the investment horizon of 90 days Workhorse Group is expected to under-perform the Massimo Group. In addition to that, Workhorse is 1.26 times more volatile than Massimo Group Common. It trades about -0.09 of its total potential returns per unit of risk. Massimo Group Common is currently generating about 0.02 per unit of volatility. If you would invest  301.00  in Massimo Group Common on September 12, 2024 and sell it today you would lose (13.00) from holding Massimo Group Common or give up 4.32% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	50.0%
Values	Daily Returns

Workhorse Group  vs.  Massimo Group Common

Workhorse Group

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Workhorse Group are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating technical indicators, Workhorse unveiled solid returns over the last few months and may actually be approaching a breakup point.

Massimo Group Common

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Massimo Group Common has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's primary indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Workhorse and Massimo Group

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

The idea behind Workhorse Group and Massimo Group Common 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.