Correlation Between Ep Emerging and Knife River
Can any of the company-specific risk be diversified away by investing in both Ep Emerging and Knife River 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 Ep Emerging and Knife River into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ep Emerging Markets and Knife River, you can compare the effects of market volatilities on Ep Emerging and Knife River 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 Ep Emerging with a short position of Knife River. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ep Emerging and Knife River.
Diversification Opportunities for Ep Emerging and Knife River
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between EPASX and Knife is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Ep Emerging Markets and Knife River in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Knife River and Ep Emerging 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 Ep Emerging Markets are associated (or correlated) with Knife River. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Knife River has no effect on the direction of Ep Emerging i.e., Ep Emerging and Knife River go up and down completely randomly.
Pair Corralation between Ep Emerging and Knife River
Assuming the 90 days horizon Ep Emerging Markets is expected to under-perform the Knife River. But the mutual fund apears to be less risky and, when comparing its historical volatility, Ep Emerging Markets is 3.77 times less risky than Knife River. The mutual fund trades about -0.25 of its potential returns per unit of risk. The Knife River is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 9,345 in Knife River on August 26, 2024 and sell it today you would earn a total of 920.00 from holding Knife River or generate 9.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ep Emerging Markets vs. Knife River
Performance |
| Timeline |
| Ep Emerging Markets |
| Knife River |
Ep Emerging and Knife River Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ep Emerging and Knife River
The main advantage of trading using opposite Ep Emerging and Knife River positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ep Emerging position performs unexpectedly, Knife River 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 Knife River will offset losses from the drop in Knife River's long position.| Ep Emerging vs. Fidelity Series Government | Ep Emerging vs. Government Securities Fund | Ep Emerging vs. Short Term Government Fund | Ep Emerging vs. Us Government Securities |
| Knife River vs. Cemex SAB de | Knife River vs. Boise Cascad Llc | Knife River vs. CRH PLC ADR | Knife River vs. Eagle Materials |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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