Correlation Between EMPEROR ENT and Hyster Yale

Can any of the company-specific risk be diversified away by investing in both EMPEROR ENT and Hyster Yale 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 EMPEROR ENT and Hyster Yale into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between EMPEROR ENT HOTEL and Hyster Yale Materials Handling, you can compare the effects of market volatilities on EMPEROR ENT and Hyster Yale 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 EMPEROR ENT with a short position of Hyster Yale. Check out your portfolio center. Please also check ongoing floating volatility patterns of EMPEROR ENT and Hyster Yale.

Diversification Opportunities for EMPEROR ENT and Hyster Yale

0.45

Correlation Coefficient

EMPEROR ENT  Hyster Yale

Very weak diversification

The 3 months correlation between EMPEROR and Hyster is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding EMPEROR ENT HOTEL and Hyster Yale Materials Handling in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyster Yale Materials and EMPEROR ENT 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 EMPEROR ENT HOTEL are associated (or correlated) with Hyster Yale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyster Yale Materials has no effect on the direction of EMPEROR ENT i.e., EMPEROR ENT and Hyster Yale go up and down completely randomly.

Pair Corralation between EMPEROR ENT and Hyster Yale

Assuming the 90 days trading horizon EMPEROR ENT HOTEL is expected to under-perform the Hyster Yale. In addition to that, EMPEROR ENT is 1.36 times more volatile than Hyster Yale Materials Handling. It trades about -0.18 of its total potential returns per unit of risk. Hyster Yale Materials Handling is currently generating about -0.09 per unit of volatility. If you would invest  3,540  in Hyster Yale Materials Handling on March 31, 2025 and sell it today you would lose (240.00) from holding Hyster Yale Materials Handling or give up 6.78% of portfolio value over 90 days.

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

EMPEROR ENT HOTEL  vs.  Hyster Yale Materials Handling

EMPEROR ENT HOTEL

Risk-Adjusted Performance

Very Weak

Over the last 90 days EMPEROR ENT HOTEL has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's technical and fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Hyster Yale Materials

Risk-Adjusted Performance

Very Weak

Over the last 90 days Hyster Yale Materials Handling has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's technical and fundamental indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with EMPEROR ENT and Hyster Yale

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

The idea behind EMPEROR ENT HOTEL and Hyster Yale Materials Handling 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.