Correlation Between Tritium DCFC and Kimball Electronics
Can any of the company-specific risk be diversified away by investing in both Tritium DCFC 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 Tritium DCFC and Kimball Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tritium DCFC Limited and Kimball Electronics, you can compare the effects of market volatilities on Tritium DCFC 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 Tritium DCFC with a short position of Kimball Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tritium DCFC and Kimball Electronics.
Diversification Opportunities for Tritium DCFC and Kimball Electronics
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tritium and Kimball is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Tritium DCFC Limited and Kimball Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kimball Electronics and Tritium DCFC 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 Tritium DCFC Limited 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 Tritium DCFC i.e., Tritium DCFC and Kimball Electronics go up and down completely randomly.
Pair Corralation between Tritium DCFC and Kimball Electronics
Assuming the 90 days horizon Tritium DCFC Limited is expected to generate 15.0 times more return on investment than Kimball Electronics. However, Tritium DCFC is 15.0 times more volatile than Kimball Electronics. It trades about 0.09 of its potential returns per unit of risk. Kimball Electronics is currently generating about -0.02 per unit of risk. If you would invest 3.21 in Tritium DCFC Limited on August 28, 2024 and sell it today you would lose (1.41) from holding Tritium DCFC Limited or give up 43.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 31.58% |
| Values | Daily Returns |
Tritium DCFC Limited vs. Kimball Electronics
Performance |
| Timeline |
| Tritium DCFC Limited |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Kimball Electronics |
Tritium DCFC and Kimball Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tritium DCFC and Kimball Electronics
The main advantage of trading using opposite Tritium DCFC and Kimball Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tritium DCFC 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.| Tritium DCFC vs. Tritium Dcfc | Tritium DCFC vs. EVgo Equity Warrants | Tritium DCFC vs. Solid Power | Tritium DCFC vs. Thayer Ventures Acquisition |
| 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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