Correlation Between Daktronics and Corning Incorporated
Can any of the company-specific risk be diversified away by investing in both Daktronics and Corning Incorporated 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 Daktronics and Corning Incorporated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daktronics and Corning Incorporated, you can compare the effects of market volatilities on Daktronics and Corning Incorporated 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 Daktronics with a short position of Corning Incorporated. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daktronics and Corning Incorporated.
Diversification Opportunities for Daktronics and Corning Incorporated
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Daktronics and Corning is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Daktronics and Corning Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Corning Incorporated and Daktronics 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 Daktronics are associated (or correlated) with Corning Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Corning Incorporated has no effect on the direction of Daktronics i.e., Daktronics and Corning Incorporated go up and down completely randomly.
Pair Corralation between Daktronics and Corning Incorporated
Given the investment horizon of 90 days Daktronics is expected to under-perform the Corning Incorporated. But the stock apears to be less risky and, when comparing its historical volatility, Daktronics is 1.3 times less risky than Corning Incorporated. The stock trades about -0.07 of its potential returns per unit of risk. The Corning Incorporated is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 4,984 in Corning Incorporated on November 18, 2024 and sell it today you would earn a total of 270.00 from holding Corning Incorporated or generate 5.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daktronics vs. Corning Incorporated
Performance |
| Timeline |
| Daktronics |
| Corning Incorporated |
Daktronics and Corning Incorporated Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daktronics and Corning Incorporated
The main advantage of trading using opposite Daktronics and Corning Incorporated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daktronics position performs unexpectedly, Corning Incorporated 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 Corning Incorporated will offset losses from the drop in Corning Incorporated's long position.| Daktronics vs. Plexus Corp | Daktronics vs. OSI Systems | Daktronics vs. CTS Corporation | Daktronics vs. Benchmark Electronics |
| Corning Incorporated vs. OSI Systems | Corning Incorporated vs. Fabrinet | Corning Incorporated vs. Jabil Circuit | Corning Incorporated vs. Vicor |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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