Correlation Between KIMBALL ELECTRONICS and DICKS Sporting
Can any of the company-specific risk be diversified away by investing in both KIMBALL ELECTRONICS and DICKS Sporting 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 DICKS Sporting into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KIMBALL ELECTRONICS and DICKS Sporting Goods, you can compare the effects of market volatilities on KIMBALL ELECTRONICS and DICKS Sporting 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 DICKS Sporting. Check out your portfolio center. Please also check ongoing floating volatility patterns of KIMBALL ELECTRONICS and DICKS Sporting.
Diversification Opportunities for KIMBALL ELECTRONICS and DICKS Sporting
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between KIMBALL and DICKS is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding KIMBALL ELECTRONICS and DICKS Sporting Goods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DICKS Sporting Goods 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 DICKS Sporting. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DICKS Sporting Goods has no effect on the direction of KIMBALL ELECTRONICS i.e., KIMBALL ELECTRONICS and DICKS Sporting go up and down completely randomly.
Pair Corralation between KIMBALL ELECTRONICS and DICKS Sporting
Assuming the 90 days horizon KIMBALL ELECTRONICS is expected to generate 1.31 times more return on investment than DICKS Sporting. However, KIMBALL ELECTRONICS is 1.31 times more volatile than DICKS Sporting Goods. It trades about 0.14 of its potential returns per unit of risk. DICKS Sporting Goods is currently generating about 0.15 per unit of risk. If you would invest 1,630 in KIMBALL ELECTRONICS on September 1, 2024 and sell it today you would earn a total of 190.00 from holding KIMBALL ELECTRONICS or generate 11.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KIMBALL ELECTRONICS vs. DICKS Sporting Goods
Performance |
| Timeline |
| KIMBALL ELECTRONICS |
| DICKS Sporting Goods |
KIMBALL ELECTRONICS and DICKS Sporting Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KIMBALL ELECTRONICS and DICKS Sporting
The main advantage of trading using opposite KIMBALL ELECTRONICS and DICKS Sporting positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KIMBALL ELECTRONICS position performs unexpectedly, DICKS Sporting 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 DICKS Sporting will offset losses from the drop in DICKS Sporting's long position.| KIMBALL ELECTRONICS vs. SEALED AIR | KIMBALL ELECTRONICS vs. WIZZ AIR HLDGUNSPADR4 | KIMBALL ELECTRONICS vs. Fair Isaac Corp | KIMBALL ELECTRONICS vs. Wizz Air Holdings |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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