Correlation Between Kimball International and American Woodmark
Can any of the company-specific risk be diversified away by investing in both Kimball International and American Woodmark 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 Kimball International and American Woodmark into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kimball International and American Woodmark, you can compare the effects of market volatilities on Kimball International and American Woodmark 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 Kimball International with a short position of American Woodmark. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kimball International and American Woodmark.
Diversification Opportunities for Kimball International and American Woodmark
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kimball and American is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Kimball International and American Woodmark in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Woodmark and Kimball International 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 Kimball International are associated (or correlated) with American Woodmark. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Woodmark has no effect on the direction of Kimball International i.e., Kimball International and American Woodmark go up and down completely randomly.
Pair Corralation between Kimball International and American Woodmark
If you would invest 9,609 in American Woodmark on August 28, 2024 and sell it today you would earn a total of 477.00 from holding American Woodmark or generate 4.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Kimball International vs. American Woodmark
Performance |
| Timeline |
| Kimball International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| American Woodmark |
Kimball International and American Woodmark Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kimball International and American Woodmark
The main advantage of trading using opposite Kimball International and American Woodmark positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kimball International position performs unexpectedly, American Woodmark 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 American Woodmark will offset losses from the drop in American Woodmark's long position.| Kimball International vs. Kimball Electronics | Kimball International vs. Interface | Kimball International vs. James River Group | Kimball International vs. Midland States Bancorp |
| American Woodmark vs. La Z Boy Incorporated | American Woodmark vs. Natuzzi SpA | American Woodmark vs. Mohawk Industries | American Woodmark vs. MasterBrand |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Transaction History View history of all your transactions and understand their impact on performance |