Correlation Between Douglas Dynamics and Miller Industries
Can any of the company-specific risk be diversified away by investing in both Douglas Dynamics and Miller Industries 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 Douglas Dynamics and Miller Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Douglas Dynamics and Miller Industries, you can compare the effects of market volatilities on Douglas Dynamics and Miller Industries 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 Douglas Dynamics with a short position of Miller Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Douglas Dynamics and Miller Industries.
Diversification Opportunities for Douglas Dynamics and Miller Industries
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Douglas and Miller is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Douglas Dynamics and Miller Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Miller Industries and Douglas Dynamics 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 Douglas Dynamics are associated (or correlated) with Miller Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Miller Industries has no effect on the direction of Douglas Dynamics i.e., Douglas Dynamics and Miller Industries go up and down completely randomly.
Pair Corralation between Douglas Dynamics and Miller Industries
Given the investment horizon of 90 days Douglas Dynamics is expected to under-perform the Miller Industries. But the stock apears to be less risky and, when comparing its historical volatility, Douglas Dynamics is 1.0 times less risky than Miller Industries. The stock trades about -0.22 of its potential returns per unit of risk. The Miller Industries is currently generating about -0.02 of returns per unit of risk over similar time horizon. If you would invest 4,963 in Miller Industries on January 30, 2024 and sell it today you would lose (49.00) from holding Miller Industries or give up 0.99% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Douglas Dynamics vs. Miller Industries
Performance |
Timeline |
Douglas Dynamics |
Miller Industries |
Douglas Dynamics and Miller Industries Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Douglas Dynamics and Miller Industries
The main advantage of trading using opposite Douglas Dynamics and Miller Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Douglas Dynamics position performs unexpectedly, Miller Industries 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 Miller Industries will offset losses from the drop in Miller Industries' long position.Douglas Dynamics vs. Monro Muffler Brake | Douglas Dynamics vs. Motorcar Parts of | Douglas Dynamics vs. Standard Motor Products | Douglas Dynamics vs. Stoneridge |
Miller Industries vs. Dorman Products | Miller Industries vs. Standard Motor Products | Miller Industries vs. Motorcar Parts of | Miller Industries vs. Douglas Dynamics |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
Other Complementary Tools
Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
Fundamental Analysis View fundamental data based on most recent published financial statements | |
Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
Bonds Directory Find actively traded corporate debentures issued by US companies |