Correlation Between Infinera and Knowles Cor
Can any of the company-specific risk be diversified away by investing in both Infinera and Knowles Cor 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 Infinera and Knowles Cor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Infinera and Knowles Cor, you can compare the effects of market volatilities on Infinera and Knowles Cor 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 Infinera with a short position of Knowles Cor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Infinera and Knowles Cor.
Diversification Opportunities for Infinera and Knowles Cor
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Infinera and Knowles is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Infinera and Knowles Cor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Knowles Cor and Infinera 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 Infinera are associated (or correlated) with Knowles Cor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Knowles Cor has no effect on the direction of Infinera i.e., Infinera and Knowles Cor go up and down completely randomly.
Pair Corralation between Infinera and Knowles Cor
Given the investment horizon of 90 days Infinera is expected to under-perform the Knowles Cor. But the stock apears to be less risky and, when comparing its historical volatility, Infinera is 7.43 times less risky than Knowles Cor. The stock trades about -0.26 of its potential returns per unit of risk. The Knowles Cor is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,809 in Knowles Cor on August 28, 2024 and sell it today you would earn a total of 119.00 from holding Knowles Cor or generate 6.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Infinera vs. Knowles Cor
Performance |
| Timeline |
| Infinera |
| Knowles Cor |
Infinera and Knowles Cor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Infinera and Knowles Cor
The main advantage of trading using opposite Infinera and Knowles Cor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Infinera position performs unexpectedly, Knowles Cor 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 Knowles Cor will offset losses from the drop in Knowles Cor's long position.| Infinera vs. Ichor Holdings | Infinera vs. Fabrinet | Infinera vs. Hello Group | Infinera vs. Ultra Clean Holdings |
| Knowles Cor vs. Mynaric AG ADR | Knowles Cor vs. Comtech Telecommunications Corp | Knowles Cor vs. Ituran Location and | Knowles Cor vs. Aviat Networks |
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.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum |