Correlation Between Park Ohio and Manning Napier
Can any of the company-specific risk be diversified away by investing in both Park Ohio and Manning Napier 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 Park Ohio and Manning Napier into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Park Ohio Holdings and Manning Napier, you can compare the effects of market volatilities on Park Ohio and Manning Napier 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 Park Ohio with a short position of Manning Napier. Check out your portfolio center. Please also check ongoing floating volatility patterns of Park Ohio and Manning Napier.
Diversification Opportunities for Park Ohio and Manning Napier
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Park and Manning is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Park Ohio Holdings and Manning Napier in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manning Napier and Park Ohio 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 Park Ohio Holdings are associated (or correlated) with Manning Napier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manning Napier has no effect on the direction of Park Ohio i.e., Park Ohio and Manning Napier go up and down completely randomly.
Pair Corralation between Park Ohio and Manning Napier
Given the investment horizon of 90 days Park Ohio Holdings is expected to generate 4.1 times more return on investment than Manning Napier. However, Park Ohio is 4.1 times more volatile than Manning Napier. It trades about 0.06 of its potential returns per unit of risk. Manning Napier is currently generating about 0.07 per unit of risk. If you would invest 1,376 in Park Ohio Holdings on February 5, 2024 and sell it today you would earn a total of 1,231 from holding Park Ohio Holdings or generate 89.46% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 23.59% |
Values | Daily Returns |
Park Ohio Holdings vs. Manning Napier
Performance |
Timeline |
Park Ohio Holdings |
Manning Napier |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Park Ohio and Manning Napier Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Park Ohio and Manning Napier
The main advantage of trading using opposite Park Ohio and Manning Napier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Park Ohio position performs unexpectedly, Manning Napier 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 Manning Napier will offset losses from the drop in Manning Napier's long position.Park Ohio vs. Crane NXT Co | Park Ohio vs. Donaldson | Park Ohio vs. ITT Inc | Park Ohio vs. Franklin Electric Co |
Manning Napier vs. Vishay Intertechnology | Manning Napier vs. Comstock Holding Companies | Manning Napier vs. United Microelectronics | Manning Napier vs. Weibo Corp |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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