Correlation Between KIMBALL ELECTRONICS and AMP
Can any of the company-specific risk be diversified away by investing in both KIMBALL ELECTRONICS and AMP 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 KIMBALL ELECTRONICS and AMP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KIMBALL ELECTRONICS and AMP, you can compare the effects of market volatilities on KIMBALL ELECTRONICS and AMP 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 KIMBALL ELECTRONICS with a short position of AMP. Check out your portfolio center. Please also check ongoing floating volatility patterns of KIMBALL ELECTRONICS and AMP.
Diversification Opportunities for KIMBALL ELECTRONICS and AMP
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between KIMBALL and AMP is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding KIMBALL ELECTRONICS and AMP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AMP and KIMBALL ELECTRONICS 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 KIMBALL ELECTRONICS are associated (or correlated) with AMP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AMP has no effect on the direction of KIMBALL ELECTRONICS i.e., KIMBALL ELECTRONICS and AMP go up and down completely randomly.
Pair Corralation between KIMBALL ELECTRONICS and AMP
Assuming the 90 days horizon KIMBALL ELECTRONICS is expected to under-perform the AMP. But the stock apears to be less risky and, when comparing its historical volatility, KIMBALL ELECTRONICS is 1.19 times less risky than AMP. The stock trades about -0.17 of its potential returns per unit of risk. The AMP is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 91.00 in AMP on September 13, 2024 and sell it today you would earn a total of 3.00 from holding AMP or generate 3.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
KIMBALL ELECTRONICS vs. AMP
Performance |
| Timeline |
| KIMBALL ELECTRONICS |
| AMP |
KIMBALL ELECTRONICS and AMP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KIMBALL ELECTRONICS and AMP
The main advantage of trading using opposite KIMBALL ELECTRONICS and AMP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KIMBALL ELECTRONICS position performs unexpectedly, AMP 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 AMP will offset losses from the drop in AMP's long position.| KIMBALL ELECTRONICS vs. Superior Plus Corp | KIMBALL ELECTRONICS vs. SIVERS SEMICONDUCTORS AB | KIMBALL ELECTRONICS vs. Norsk Hydro ASA | KIMBALL ELECTRONICS vs. Reliance Steel Aluminum |
| AMP vs. Broadridge Financial Solutions | AMP vs. Gold Road Resources | AMP vs. GOLD ROAD RES | AMP vs. Transportadora de Gas |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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