Correlation Between Hurco Companies and Crane
Can any of the company-specific risk be diversified away by investing in both Hurco Companies and Crane 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 Crane into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hurco Companies and Crane Company, you can compare the effects of market volatilities on Hurco Companies and Crane 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 Crane. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hurco Companies and Crane.
Diversification Opportunities for Hurco Companies and Crane
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hurco and Crane is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Hurco Companies and Crane Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Crane Company 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 Crane. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Crane Company has no effect on the direction of Hurco Companies i.e., Hurco Companies and Crane go up and down completely randomly.
Pair Corralation between Hurco Companies and Crane
Given the investment horizon of 90 days Hurco Companies is expected to generate 18.23 times less return on investment than Crane. But when comparing it to its historical volatility, Hurco Companies is 1.07 times less risky than Crane. It trades about 0.0 of its potential returns per unit of risk. Crane Company is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 9,588 in Crane Company on September 6, 2024 and sell it today you would earn a total of 8,029 from holding Crane Company or generate 83.74% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Hurco Companies vs. Crane Company
Performance |
Timeline |
Hurco Companies |
Crane Company |
Hurco Companies and Crane Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Hurco Companies and Crane
The main advantage of trading using opposite Hurco Companies and Crane positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hurco Companies position performs unexpectedly, Crane 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 Crane will offset losses from the drop in Crane's long position.Hurco Companies vs. Dover | Hurco Companies vs. Illinois Tool Works | Hurco Companies vs. Ingersoll Rand | Hurco Companies vs. Eaton PLC |
Crane vs. Standex International | Crane vs. Donaldson | Crane vs. CSW Industrials | Crane vs. Franklin Electric Co |
Check out your portfolio center.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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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