Correlation Between Ampco Pittsburgh and Hillenbrand

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Ampco Pittsburgh and Hillenbrand 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 Ampco Pittsburgh and Hillenbrand into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ampco Pittsburgh and Hillenbrand, you can compare the effects of market volatilities on Ampco Pittsburgh and Hillenbrand 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 Ampco Pittsburgh with a short position of Hillenbrand. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ampco Pittsburgh and Hillenbrand.

Diversification Opportunities for Ampco Pittsburgh and Hillenbrand

-0.08
  Correlation Coefficient

Good diversification

The 3 months correlation between Ampco and Hillenbrand is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Ampco Pittsburgh and Hillenbrand in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hillenbrand and Ampco Pittsburgh 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 Ampco Pittsburgh are associated (or correlated) with Hillenbrand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hillenbrand has no effect on the direction of Ampco Pittsburgh i.e., Ampco Pittsburgh and Hillenbrand go up and down completely randomly.

Pair Corralation between Ampco Pittsburgh and Hillenbrand

Allowing for the 90-day total investment horizon Ampco Pittsburgh is expected to generate 0.78 times more return on investment than Hillenbrand. However, Ampco Pittsburgh is 1.29 times less risky than Hillenbrand. It trades about -0.12 of its potential returns per unit of risk. Hillenbrand is currently generating about -0.18 per unit of risk. If you would invest  220.00  in Ampco Pittsburgh on February 3, 2024 and sell it today you would lose (16.00) from holding Ampco Pittsburgh or give up 7.27% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Ampco Pittsburgh  vs.  Hillenbrand

 Performance 
       Timeline  
Ampco Pittsburgh 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Ampco Pittsburgh has generated negative risk-adjusted returns adding no value to investors with long positions. Even with inconsistent performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in June 2024. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.
Hillenbrand 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Hillenbrand has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's forward indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Ampco Pittsburgh and Hillenbrand Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Ampco Pittsburgh and Hillenbrand

The main advantage of trading using opposite Ampco Pittsburgh and Hillenbrand positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ampco Pittsburgh position performs unexpectedly, Hillenbrand 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 Hillenbrand will offset losses from the drop in Hillenbrand's long position.
The idea behind Ampco Pittsburgh and Hillenbrand 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.

Other Complementary Tools

FinTech Suite
Use AI to screen and filter profitable investment opportunities
Portfolio Diagnostics
Use generated alerts and portfolio events aggregator to diagnose current holdings
Idea Breakdown
Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes
Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance
Stocks Directory
Find actively traded stocks across global markets