Correlation Between Fortive Corp and Kraken Robotics
Can any of the company-specific risk be diversified away by investing in both Fortive Corp and Kraken Robotics 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 Fortive Corp and Kraken Robotics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fortive Corp and Kraken Robotics, you can compare the effects of market volatilities on Fortive Corp and Kraken Robotics 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 Fortive Corp with a short position of Kraken Robotics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fortive Corp and Kraken Robotics.
Diversification Opportunities for Fortive Corp and Kraken Robotics
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Fortive and Kraken is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Fortive Corp and Kraken Robotics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kraken Robotics and Fortive Corp 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 Fortive Corp are associated (or correlated) with Kraken Robotics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kraken Robotics has no effect on the direction of Fortive Corp i.e., Fortive Corp and Kraken Robotics go up and down completely randomly.
Pair Corralation between Fortive Corp and Kraken Robotics
Considering the 90-day investment horizon Fortive Corp is expected to generate 10.58 times less return on investment than Kraken Robotics. But when comparing it to its historical volatility, Fortive Corp is 2.77 times less risky than Kraken Robotics. It trades about 0.04 of its potential returns per unit of risk. Kraken Robotics is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 37.00 in Kraken Robotics on September 19, 2024 and sell it today you would earn a total of 132.00 from holding Kraken Robotics or generate 356.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fortive Corp vs. Kraken Robotics
Performance |
| Timeline |
| Fortive Corp |
| Kraken Robotics |
Fortive Corp and Kraken Robotics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fortive Corp and Kraken Robotics
The main advantage of trading using opposite Fortive Corp and Kraken Robotics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fortive Corp position performs unexpectedly, Kraken Robotics 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 Kraken Robotics will offset losses from the drop in Kraken Robotics' long position.| Fortive Corp vs. Vishay Precision Group | Fortive Corp vs. Sensata Technologies Holding | Fortive Corp vs. Badger Meter | Fortive Corp vs. Trimble |
| Kraken Robotics vs. Garmin | Kraken Robotics vs. Keysight Technologies | Kraken Robotics vs. Fortive Corp | Kraken Robotics vs. Teledyne Technologies Incorporated |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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