Correlation Between KIMBALL ELECTRONICS and MeVis Medical
Can any of the company-specific risk be diversified away by investing in both KIMBALL ELECTRONICS and MeVis Medical 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 MeVis Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KIMBALL ELECTRONICS and MeVis Medical Solutions, you can compare the effects of market volatilities on KIMBALL ELECTRONICS and MeVis Medical 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 MeVis Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of KIMBALL ELECTRONICS and MeVis Medical.
Diversification Opportunities for KIMBALL ELECTRONICS and MeVis Medical
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between KIMBALL and MeVis is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding KIMBALL ELECTRONICS and MeVis Medical Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MeVis Medical Solutions 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 MeVis Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MeVis Medical Solutions has no effect on the direction of KIMBALL ELECTRONICS i.e., KIMBALL ELECTRONICS and MeVis Medical go up and down completely randomly.
Pair Corralation between KIMBALL ELECTRONICS and MeVis Medical
Assuming the 90 days horizon KIMBALL ELECTRONICS is expected to generate 11.73 times less return on investment than MeVis Medical. In addition to that, KIMBALL ELECTRONICS is 1.91 times more volatile than MeVis Medical Solutions. It trades about 0.01 of its total potential returns per unit of risk. MeVis Medical Solutions is currently generating about 0.13 per unit of volatility. If you would invest 2,440 in MeVis Medical Solutions on October 28, 2024 and sell it today you would earn a total of 40.00 from holding MeVis Medical Solutions or generate 1.64% 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. MeVis Medical Solutions
Performance |
| Timeline |
| KIMBALL ELECTRONICS |
| MeVis Medical Solutions |
KIMBALL ELECTRONICS and MeVis Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KIMBALL ELECTRONICS and MeVis Medical
The main advantage of trading using opposite KIMBALL ELECTRONICS and MeVis Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KIMBALL ELECTRONICS position performs unexpectedly, MeVis Medical 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 MeVis Medical will offset losses from the drop in MeVis Medical's long position.| KIMBALL ELECTRONICS vs. TELECOM ITALIA | KIMBALL ELECTRONICS vs. CarsalesCom | KIMBALL ELECTRONICS vs. Cairo Communication SpA | KIMBALL ELECTRONICS vs. Salesforce |
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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