Correlation Between KERNEL HLDG and Dow Jones
Can any of the company-specific risk be diversified away by investing in both KERNEL HLDG and Dow Jones 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 KERNEL HLDG and Dow Jones into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KERNEL HLDG and Dow Jones Industrial, you can compare the effects of market volatilities on KERNEL HLDG and Dow Jones 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 KERNEL HLDG with a short position of Dow Jones. Check out your portfolio center. Please also check ongoing floating volatility patterns of KERNEL HLDG and Dow Jones.
Diversification Opportunities for KERNEL HLDG and Dow Jones
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between KERNEL and Dow is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding KERNEL HLDG and Dow Jones Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dow Jones Industrial and KERNEL HLDG 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 KERNEL HLDG are associated (or correlated) with Dow Jones. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dow Jones Industrial has no effect on the direction of KERNEL HLDG i.e., KERNEL HLDG and Dow Jones go up and down completely randomly.
Pair Corralation between KERNEL HLDG and Dow Jones
Assuming the 90 days trading horizon KERNEL HLDG is expected to generate 5.97 times more return on investment than Dow Jones. However, KERNEL HLDG is 5.97 times more volatile than Dow Jones Industrial. It trades about 0.07 of its potential returns per unit of risk. Dow Jones Industrial is currently generating about 0.12 per unit of risk. If you would invest 157.00 in KERNEL HLDG on September 14, 2024 and sell it today you would earn a total of 131.00 from holding KERNEL HLDG or generate 83.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 97.81% |
| Values | Daily Returns |
KERNEL HLDG vs. Dow Jones Industrial
Performance |
| Timeline |
KERNEL HLDG and Dow Jones Volatility Contrast
Predicted Return Density |
| Returns |
KERNEL HLDG
Pair trading matchups for KERNEL HLDG
Dow Jones Industrial
Pair trading matchups for Dow Jones
Pair Trading with KERNEL HLDG and Dow Jones
The main advantage of trading using opposite KERNEL HLDG and Dow Jones positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KERNEL HLDG position performs unexpectedly, Dow Jones 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 Dow Jones will offset losses from the drop in Dow Jones' long position.| KERNEL HLDG vs. SIDETRADE EO 1 | KERNEL HLDG vs. The Trade Desk | KERNEL HLDG vs. Global Ship Lease | KERNEL HLDG vs. TRADEDOUBLER AB SK |
| Dow Jones vs. Hurco Companies | Dow Jones vs. Tyson Foods | Dow Jones vs. MYR Group | Dow Jones vs. Cannae Holdings |
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 Positions Ratings module to 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.
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