Correlation Between Kenmec Mechanical and Coretronic
Can any of the company-specific risk be diversified away by investing in both Kenmec Mechanical and Coretronic 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 Kenmec Mechanical and Coretronic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kenmec Mechanical Engineering and Coretronic, you can compare the effects of market volatilities on Kenmec Mechanical and Coretronic 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 Kenmec Mechanical with a short position of Coretronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kenmec Mechanical and Coretronic.
Diversification Opportunities for Kenmec Mechanical and Coretronic
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kenmec and Coretronic is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Kenmec Mechanical Engineering and Coretronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coretronic and Kenmec Mechanical 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 Kenmec Mechanical Engineering are associated (or correlated) with Coretronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coretronic has no effect on the direction of Kenmec Mechanical i.e., Kenmec Mechanical and Coretronic go up and down completely randomly.
Pair Corralation between Kenmec Mechanical and Coretronic
Assuming the 90 days trading horizon Kenmec Mechanical Engineering is expected to generate 0.9 times more return on investment than Coretronic. However, Kenmec Mechanical Engineering is 1.11 times less risky than Coretronic. It trades about 0.13 of its potential returns per unit of risk. Coretronic is currently generating about 0.07 per unit of risk. If you would invest 8,460 in Kenmec Mechanical Engineering on October 14, 2024 and sell it today you would earn a total of 600.00 from holding Kenmec Mechanical Engineering or generate 7.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kenmec Mechanical Engineering vs. Coretronic
Performance |
| Timeline |
| Kenmec Mechanical |
| Coretronic |
Kenmec Mechanical and Coretronic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kenmec Mechanical and Coretronic
The main advantage of trading using opposite Kenmec Mechanical and Coretronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kenmec Mechanical position performs unexpectedly, Coretronic 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 Coretronic will offset losses from the drop in Coretronic's long position.| Kenmec Mechanical vs. Yuanta Financial Holdings | Kenmec Mechanical vs. Prime Oil Chemical | Kenmec Mechanical vs. Mechema Chemicals Int | Kenmec Mechanical vs. Shinkong Synthetic Fiber |
| Coretronic vs. Qisda Corp | Coretronic vs. AU Optronics | Coretronic vs. Vanguard International Semiconductor | Coretronic vs. Lite On Technology Corp |
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 Stocks Directory module to find actively traded stocks across global markets.
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