Correlation Between Ecotel Communication and KIMBALL ELECTRONICS
Can any of the company-specific risk be diversified away by investing in both Ecotel Communication 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 Ecotel Communication and KIMBALL ELECTRONICS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ecotel communication ag and KIMBALL ELECTRONICS, you can compare the effects of market volatilities on Ecotel Communication 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 Ecotel Communication with a short position of KIMBALL ELECTRONICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ecotel Communication and KIMBALL ELECTRONICS.
Diversification Opportunities for Ecotel Communication and KIMBALL ELECTRONICS
0.46 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ecotel and KIMBALL is 0.46. Overlapping area represents the amount of risk that can be diversified away by holding ecotel communication ag and KIMBALL ELECTRONICS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KIMBALL ELECTRONICS and Ecotel Communication 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 ecotel communication ag 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 Ecotel Communication i.e., Ecotel Communication and KIMBALL ELECTRONICS go up and down completely randomly.
Pair Corralation between Ecotel Communication and KIMBALL ELECTRONICS
Assuming the 90 days trading horizon ecotel communication ag is expected to generate 0.58 times more return on investment than KIMBALL ELECTRONICS. However, ecotel communication ag is 1.72 times less risky than KIMBALL ELECTRONICS. It trades about -0.02 of its potential returns per unit of risk. KIMBALL ELECTRONICS is currently generating about -0.02 per unit of risk. If you would invest 1,461 in ecotel communication ag on October 13, 2024 and sell it today you would lose (86.00) from holding ecotel communication ag or give up 5.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ecotel communication ag vs. KIMBALL ELECTRONICS
Performance |
| Timeline |
| ecotel communication |
| KIMBALL ELECTRONICS |
Ecotel Communication and KIMBALL ELECTRONICS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ecotel Communication and KIMBALL ELECTRONICS
The main advantage of trading using opposite Ecotel Communication and KIMBALL ELECTRONICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ecotel Communication 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's long position.| Ecotel Communication vs. TRI CHEMICAL LABORATINC | Ecotel Communication vs. Transport International Holdings | Ecotel Communication vs. X FAB Silicon Foundries | Ecotel Communication vs. Sekisui Chemical Co |
| KIMBALL ELECTRONICS vs. Ryanair Holdings plc | KIMBALL ELECTRONICS vs. MAGIC SOFTWARE ENTR | KIMBALL ELECTRONICS vs. OPERA SOFTWARE | KIMBALL ELECTRONICS vs. Alaska Air Group |
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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