Correlation Between Kaman and AAR Corp
Can any of the company-specific risk be diversified away by investing in both Kaman and AAR Corp 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 Kaman and AAR Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kaman and AAR Corp, you can compare the effects of market volatilities on Kaman and AAR Corp 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 Kaman with a short position of AAR Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaman and AAR Corp.
Diversification Opportunities for Kaman and AAR Corp
Very good diversification
The 3 months correlation between Kaman and AAR is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Kaman and AAR Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AAR Corp and Kaman 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 Kaman are associated (or correlated) with AAR Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AAR Corp has no effect on the direction of Kaman i.e., Kaman and AAR Corp go up and down completely randomly.
Pair Corralation between Kaman and AAR Corp
If you would invest 6,167 in AAR Corp on August 23, 2024 and sell it today you would earn a total of 617.00 from holding AAR Corp or generate 10.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Kaman vs. AAR Corp
Performance |
| Timeline |
| Kaman |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| AAR Corp |
Kaman and AAR Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kaman and AAR Corp
The main advantage of trading using opposite Kaman and AAR Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaman position performs unexpectedly, AAR Corp 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 AAR Corp will offset losses from the drop in AAR Corp's long position.| Kaman vs. Ducommun Incorporated | Kaman vs. Innovative Solutions and | Kaman vs. National Presto Industries | Kaman vs. Astronics |
| AAR Corp vs. Small Cap Core | AAR Corp vs. Freedom Holding Corp | AAR Corp vs. Gfl Environmental Holdings | AAR Corp vs. Growth Fund Of |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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