Correlation Between XTANT MEDICAL and Hyster Yale

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

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

Diversification Opportunities for XTANT MEDICAL and Hyster Yale

0.48

Correlation Coefficient

XTANT MEDICAL  Hyster Yale

Very weak diversification

The 3 months correlation between XTANT and Hyster is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding XTANT MEDICAL HLDGS and Hyster Yale Materials Handling in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyster Yale Materials and XTANT MEDICAL 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 XTANT MEDICAL HLDGS are associated (or correlated) with Hyster Yale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyster Yale Materials has no effect on the direction of XTANT MEDICAL i.e., XTANT MEDICAL and Hyster Yale go up and down completely randomly.

Pair Corralation between XTANT MEDICAL and Hyster Yale

Assuming the 90 days horizon XTANT MEDICAL HLDGS is expected to generate 1.02 times more return on investment than Hyster Yale. However, XTANT MEDICAL is 1.02 times more volatile than Hyster Yale Materials Handling. It trades about -0.22 of its potential returns per unit of risk. Hyster Yale Materials Handling is currently generating about -0.23 per unit of risk. If you would invest  37.00  in XTANT MEDICAL HLDGS on September 29, 2024 and sell it today you would lose (3.00) from holding XTANT MEDICAL HLDGS or give up 8.11% of portfolio value over 90 days.

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

XTANT MEDICAL HLDGS  vs.  Hyster Yale Materials Handling

XTANT MEDICAL HLDGS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days XTANT MEDICAL HLDGS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

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. Despite latest fragile performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with XTANT MEDICAL and Hyster Yale

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

The idea behind XTANT MEDICAL HLDGS and Hyster Yale Materials Handling 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .