Correlation Between SBI Insurance and KIMBALL ELECTRONICS
Can any of the company-specific risk be diversified away by investing in both SBI Insurance 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 SBI Insurance and KIMBALL ELECTRONICS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SBI Insurance Group and KIMBALL ELECTRONICS, you can compare the effects of market volatilities on SBI Insurance 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 SBI Insurance with a short position of KIMBALL ELECTRONICS. Check out your portfolio center. Please also check ongoing floating volatility patterns of SBI Insurance and KIMBALL ELECTRONICS.
Diversification Opportunities for SBI Insurance and KIMBALL ELECTRONICS
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between SBI and KIMBALL is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding SBI Insurance Group and KIMBALL ELECTRONICS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KIMBALL ELECTRONICS and SBI Insurance 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 SBI Insurance Group 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 SBI Insurance i.e., SBI Insurance and KIMBALL ELECTRONICS go up and down completely randomly.
Pair Corralation between SBI Insurance and KIMBALL ELECTRONICS
Assuming the 90 days trading horizon SBI Insurance is expected to generate 8.27 times less return on investment than KIMBALL ELECTRONICS. But when comparing it to its historical volatility, SBI Insurance Group is 2.04 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 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,650 in KIMBALL ELECTRONICS on August 30, 2024 and sell it today you would earn a total of 170.00 from holding KIMBALL ELECTRONICS or generate 10.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SBI Insurance Group vs. KIMBALL ELECTRONICS
Performance |
| Timeline |
| SBI Insurance Group |
| KIMBALL ELECTRONICS |
SBI Insurance and KIMBALL ELECTRONICS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SBI Insurance and KIMBALL ELECTRONICS
The main advantage of trading using opposite SBI Insurance and KIMBALL ELECTRONICS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SBI Insurance 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.| SBI Insurance vs. SALESFORCE INC CDR | SBI Insurance vs. Lamar Advertising | SBI Insurance vs. UET United Electronic | SBI Insurance vs. Electronic Arts |
| KIMBALL ELECTRONICS vs. United Airlines Holdings | KIMBALL ELECTRONICS vs. BJs Wholesale Club | KIMBALL ELECTRONICS vs. QURATE RETAIL INC | KIMBALL ELECTRONICS vs. Southwest Airlines Co |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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