Correlation Between Ampco Pittsburgh and Hillenbrand
Can any of the company-specific risk be diversified away by investing in both Ampco Pittsburgh and Hillenbrand 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 Ampco Pittsburgh and Hillenbrand into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ampco Pittsburgh and Hillenbrand, you can compare the effects of market volatilities on Ampco Pittsburgh and Hillenbrand 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 Ampco Pittsburgh with a short position of Hillenbrand. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ampco Pittsburgh and Hillenbrand.
Diversification Opportunities for Ampco Pittsburgh and Hillenbrand
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ampco and Hillenbrand is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Ampco Pittsburgh and Hillenbrand in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hillenbrand and Ampco Pittsburgh 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 Ampco Pittsburgh are associated (or correlated) with Hillenbrand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hillenbrand has no effect on the direction of Ampco Pittsburgh i.e., Ampco Pittsburgh and Hillenbrand go up and down completely randomly.
Pair Corralation between Ampco Pittsburgh and Hillenbrand
Allowing for the 90-day total investment horizon Ampco Pittsburgh is expected to under-perform the Hillenbrand. In addition to that, Ampco Pittsburgh is 1.89 times more volatile than Hillenbrand. It trades about -0.02 of its total potential returns per unit of risk. Hillenbrand is currently generating about 0.02 per unit of volatility. If you would invest 4,447 in Hillenbrand on January 20, 2024 and sell it today you would earn a total of 283.00 from holding Hillenbrand or generate 6.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ampco Pittsburgh vs. Hillenbrand
Performance |
| Timeline |
| Ampco Pittsburgh |
| Hillenbrand |
Ampco Pittsburgh and Hillenbrand Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ampco Pittsburgh and Hillenbrand
The main advantage of trading using opposite Ampco Pittsburgh and Hillenbrand positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ampco Pittsburgh position performs unexpectedly, Hillenbrand 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 Hillenbrand will offset losses from the drop in Hillenbrand's long position.| Ampco Pittsburgh vs. Northwest Pipe | Ampco Pittsburgh vs. Insteel Industries | Ampco Pittsburgh vs. ESAB Corp | Ampco Pittsburgh vs. Gulf Island Fabrication |
| Hillenbrand vs. Emerson Electric | Hillenbrand vs. Smith AO | Hillenbrand vs. Eaton PLC | Hillenbrand vs. Cummins |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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