Correlation Between MSA Safety and Hudson Global

Can any of the company-specific risk be diversified away by investing in both MSA Safety and Hudson Global 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 MSA Safety and Hudson Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between MSA Safety and Hudson Global, you can compare the effects of market volatilities on MSA Safety and Hudson Global 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 MSA Safety with a short position of Hudson Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of MSA Safety and Hudson Global.

Diversification Opportunities for MSA Safety and Hudson Global

-0.58

Correlation Coefficient

MSA Safety  Hudson Global

Excellent diversification

The 3 months correlation between MSA and Hudson is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding MSA Safety and Hudson Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hudson Global and MSA Safety 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 MSA Safety are associated (or correlated) with Hudson Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hudson Global has no effect on the direction of MSA Safety i.e., MSA Safety and Hudson Global go up and down completely randomly.

Pair Corralation between MSA Safety and Hudson Global

Considering the 90-day investment horizon MSA Safety is expected to generate 0.6 times more return on investment than Hudson Global. However, MSA Safety is 1.66 times less risky than Hudson Global. It trades about 0.18 of its potential returns per unit of risk. Hudson Global is currently generating about -0.07 per unit of risk. If you would invest  15,519  in MSA Safety on May 5, 2025 and sell it today you would earn a total of  2,004  from holding MSA Safety or generate 12.91% return on investment over 90 days.

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

MSA Safety  vs.  Hudson Global

MSA Safety

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in MSA Safety are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady basic indicators, MSA Safety may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Hudson Global

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hudson Global has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's basic indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with MSA Safety and Hudson Global

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

The idea behind MSA Safety and Hudson Global 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.