Correlation Between CompX International and MillerKnoll
Can any of the company-specific risk be diversified away by investing in both CompX International and MillerKnoll 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 CompX International and MillerKnoll into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CompX International and MillerKnoll, you can compare the effects of market volatilities on CompX International and MillerKnoll 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 CompX International with a short position of MillerKnoll. Check out your portfolio center. Please also check ongoing floating volatility patterns of CompX International and MillerKnoll.
Diversification Opportunities for CompX International and MillerKnoll
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CompX and MillerKnoll is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding CompX International and MillerKnoll in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MillerKnoll and CompX International 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 CompX International are associated (or correlated) with MillerKnoll. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MillerKnoll has no effect on the direction of CompX International i.e., CompX International and MillerKnoll go up and down completely randomly.
Pair Corralation between CompX International and MillerKnoll
Considering the 90-day investment horizon CompX International is expected to under-perform the MillerKnoll. In addition to that, CompX International is 2.53 times more volatile than MillerKnoll. It trades about -0.03 of its total potential returns per unit of risk. MillerKnoll is currently generating about 0.11 per unit of volatility. If you would invest 2,360 in MillerKnoll on August 27, 2024 and sell it today you would earn a total of 93.00 from holding MillerKnoll or generate 3.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CompX International vs. MillerKnoll
Performance |
| Timeline |
| CompX International |
| MillerKnoll |
CompX International and MillerKnoll Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CompX International and MillerKnoll
The main advantage of trading using opposite CompX International and MillerKnoll positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CompX International position performs unexpectedly, MillerKnoll 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 MillerKnoll will offset losses from the drop in MillerKnoll's long position.| CompX International vs. Park Electrochemical | CompX International vs. Innovative Solutions and | CompX International vs. Curtiss Wright | CompX International vs. National Presto Industries |
| MillerKnoll vs. Bassett Furniture Industries | MillerKnoll vs. Ethan Allen Interiors | MillerKnoll vs. Natuzzi SpA | MillerKnoll vs. Flexsteel 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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