Correlation Between K-Bro Linen and Network 1
Can any of the company-specific risk be diversified away by investing in both K-Bro Linen and Network 1 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 K-Bro Linen and Network 1 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between K Bro Linen and Network 1 Technologies, you can compare the effects of market volatilities on K-Bro Linen and Network 1 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 K-Bro Linen with a short position of Network 1. Check out your portfolio center. Please also check ongoing floating volatility patterns of K-Bro Linen and Network 1.
Diversification Opportunities for K-Bro Linen and Network 1
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between K-Bro and Network is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding K Bro Linen and Network 1 Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Network 1 Technologies and K-Bro Linen 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 K Bro Linen are associated (or correlated) with Network 1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Network 1 Technologies has no effect on the direction of K-Bro Linen i.e., K-Bro Linen and Network 1 go up and down completely randomly.
Pair Corralation between K-Bro Linen and Network 1
If you would invest 128.00 in Network 1 Technologies on August 30, 2024 and sell it today you would earn a total of 6.00 from holding Network 1 Technologies or generate 4.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.35% |
| Values | Daily Returns |
K Bro Linen vs. Network 1 Technologies
Performance |
| Timeline |
| K Bro Linen |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Network 1 Technologies |
K-Bro Linen and Network 1 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with K-Bro Linen and Network 1
The main advantage of trading using opposite K-Bro Linen and Network 1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if K-Bro Linen position performs unexpectedly, Network 1 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 Network 1 will offset losses from the drop in Network 1's long position.| K-Bro Linen vs. Wilhelmina | K-Bro Linen vs. Brambles Ltd ADR | K-Bro Linen vs. Rentokil Initial PLC | K-Bro Linen vs. Team Inc |
| Network 1 vs. Civeo Corp | Network 1 vs. BrightView Holdings | Network 1 vs. Maximus | Network 1 vs. CBIZ Inc |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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