Correlation Between Hillman Solutions and Techtronic Industries

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

By analyzing existing cross correlation between Hillman Solutions Corp and Techtronic Industries Ltd, you can compare the effects of market volatilities on Hillman Solutions and Techtronic 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 Hillman Solutions with a short position of Techtronic Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hillman Solutions and Techtronic Industries.

Diversification Opportunities for Hillman Solutions and Techtronic Industries

0.63

Correlation Coefficient

Hillman Solutions  Techtronic Industries

Poor diversification

The 3 months correlation between Hillman and Techtronic is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Hillman Solutions Corp and Techtronic Industries Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Techtronic Industries and Hillman Solutions 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 Hillman Solutions Corp are associated (or correlated) with Techtronic Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Techtronic Industries has no effect on the direction of Hillman Solutions i.e., Hillman Solutions and Techtronic Industries go up and down completely randomly.

Pair Corralation between Hillman Solutions and Techtronic Industries

Given the investment horizon of 90 days Hillman Solutions is expected to generate 1.13 times less return on investment than Techtronic Industries. In addition to that, Hillman Solutions is 1.46 times more volatile than Techtronic Industries Ltd. It trades about 0.08 of its total potential returns per unit of risk. Techtronic Industries Ltd is currently generating about 0.13 per unit of volatility. If you would invest  5,291  in Techtronic Industries Ltd on May 7, 2025 and sell it today you would earn a total of  765.00  from holding Techtronic Industries Ltd or generate 14.46% return on investment over 90 days.

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

Hillman Solutions Corp  vs.  Techtronic Industries Ltd

Hillman Solutions Corp

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Hillman Solutions Corp are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very conflicting primary indicators, Hillman Solutions displayed solid returns over the last few months and may actually be approaching a breakup point.

Techtronic Industries

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Techtronic Industries Ltd are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak fundamental indicators, Techtronic Industries showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Hillman Solutions and Techtronic Industries

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

The idea behind Hillman Solutions Corp and Techtronic Industries Ltd 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.

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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.