Correlation Between KIMBALL ELECTRONICS and STORE ELECTRONIC
Can any of the company-specific risk be diversified away by investing in both KIMBALL ELECTRONICS and STORE ELECTRONIC 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 STORE ELECTRONIC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KIMBALL ELECTRONICS and STORE ELECTRONIC, you can compare the effects of market volatilities on KIMBALL ELECTRONICS and STORE ELECTRONIC 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 STORE ELECTRONIC. Check out your portfolio center. Please also check ongoing floating volatility patterns of KIMBALL ELECTRONICS and STORE ELECTRONIC.
Diversification Opportunities for KIMBALL ELECTRONICS and STORE ELECTRONIC
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between KIMBALL and STORE is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding KIMBALL ELECTRONICS and STORE ELECTRONIC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STORE ELECTRONIC 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 STORE ELECTRONIC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STORE ELECTRONIC has no effect on the direction of KIMBALL ELECTRONICS i.e., KIMBALL ELECTRONICS and STORE ELECTRONIC go up and down completely randomly.
Pair Corralation between KIMBALL ELECTRONICS and STORE ELECTRONIC
Assuming the 90 days horizon KIMBALL ELECTRONICS is expected to under-perform the STORE ELECTRONIC. But the stock apears to be less risky and, when comparing its historical volatility, KIMBALL ELECTRONICS is 1.1 times less risky than STORE ELECTRONIC. The stock trades about 0.0 of its potential returns per unit of risk. The STORE ELECTRONIC is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 15,106 in STORE ELECTRONIC on September 3, 2024 and sell it today you would lose (1,086) from holding STORE ELECTRONIC or give up 7.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KIMBALL ELECTRONICS vs. STORE ELECTRONIC
Performance |
| Timeline |
| KIMBALL ELECTRONICS |
| STORE ELECTRONIC |
KIMBALL ELECTRONICS and STORE ELECTRONIC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KIMBALL ELECTRONICS and STORE ELECTRONIC
The main advantage of trading using opposite KIMBALL ELECTRONICS and STORE ELECTRONIC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KIMBALL ELECTRONICS position performs unexpectedly, STORE ELECTRONIC 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 STORE ELECTRONIC will offset losses from the drop in STORE ELECTRONIC's long position.| KIMBALL ELECTRONICS vs. Delta Electronics Public | KIMBALL ELECTRONICS vs. YASKAWA ELEC UNSP | KIMBALL ELECTRONICS vs. VERTIV HOLCL A | KIMBALL ELECTRONICS vs. Varta AG |
| STORE ELECTRONIC vs. TOTAL GABON | STORE ELECTRONIC vs. Walgreens Boots Alliance | STORE ELECTRONIC vs. Peak Resources Limited |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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