Correlation Between Ads Tec and Kimball Electronics
Can any of the company-specific risk be diversified away by investing in both Ads Tec and Kimball Electronics 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 Ads Tec and Kimball Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ads Tec Energy and Kimball Electronics, you can compare the effects of market volatilities on Ads Tec and Kimball Electronics 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 Ads Tec with a short position of Kimball Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ads Tec and Kimball Electronics.
Diversification Opportunities for Ads Tec and Kimball Electronics
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Ads and Kimball is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Ads Tec Energy and Kimball Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kimball Electronics and Ads Tec 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 Ads Tec Energy are associated (or correlated) with Kimball Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kimball Electronics has no effect on the direction of Ads Tec i.e., Ads Tec and Kimball Electronics go up and down completely randomly.
Pair Corralation between Ads Tec and Kimball Electronics
Given the investment horizon of 90 days Ads Tec Energy is expected to generate 1.78 times more return on investment than Kimball Electronics. However, Ads Tec is 1.78 times more volatile than Kimball Electronics. It trades about 0.07 of its potential returns per unit of risk. Kimball Electronics is currently generating about 0.0 per unit of risk. If you would invest 524.00 in Ads Tec Energy on August 24, 2024 and sell it today you would earn a total of 846.00 from holding Ads Tec Energy or generate 161.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ads Tec Energy vs. Kimball Electronics
Performance |
| Timeline |
| Ads Tec Energy |
| Kimball Electronics |
Ads Tec and Kimball Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ads Tec and Kimball Electronics
The main advantage of trading using opposite Ads Tec and Kimball Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ads Tec position performs unexpectedly, Kimball Electronics 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 Kimball Electronics will offset losses from the drop in Kimball Electronics' long position.| Ads Tec vs. Espey Mfg Electronics | Ads Tec vs. NeoVolta Warrant | Ads Tec vs. Kimball Electronics | Ads Tec vs. Hayward Holdings |
| Kimball Electronics vs. Hayward Holdings | Kimball Electronics vs. Enersys | Kimball Electronics vs. Espey Mfg Electronics | Kimball Electronics vs. Advanced Energy Industries |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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