Correlation Between Kimball Electronics and Enersys
Can any of the company-specific risk be diversified away by investing in both Kimball Electronics and Enersys 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 Electronics and Enersys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kimball Electronics and Enersys, you can compare the effects of market volatilities on Kimball Electronics and Enersys 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 Electronics with a short position of Enersys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kimball Electronics and Enersys.
Diversification Opportunities for Kimball Electronics and Enersys
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kimball and Enersys is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Kimball Electronics and Enersys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Enersys and Kimball Electronics 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 Electronics are associated (or correlated) with Enersys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Enersys has no effect on the direction of Kimball Electronics i.e., Kimball Electronics and Enersys go up and down completely randomly.
Pair Corralation between Kimball Electronics and Enersys
Allowing for the 90-day total investment horizon Kimball Electronics is expected to under-perform the Enersys. In addition to that, Kimball Electronics is 1.18 times more volatile than Enersys. It trades about 0.0 of its total potential returns per unit of risk. Enersys is currently generating about 0.04 per unit of volatility. If you would invest 7,307 in Enersys on August 27, 2024 and sell it today you would earn a total of 2,445 from holding Enersys or generate 33.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kimball Electronics vs. Enersys
Performance |
| Timeline |
| Kimball Electronics |
| Enersys |
Kimball Electronics and Enersys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kimball Electronics and Enersys
The main advantage of trading using opposite Kimball Electronics and Enersys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kimball Electronics position performs unexpectedly, Enersys 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 Enersys will offset losses from the drop in Enersys' long position.| Kimball Electronics vs. Hayward Holdings | Kimball Electronics vs. Enersys | Kimball Electronics vs. Espey Mfg Electronics | Kimball Electronics vs. Advanced Energy Industries |
| Enersys vs. Bloom Energy Corp | Enersys vs. Eos Energy Enterprises | Enersys vs. Sunrise New Energy | Enersys vs. Flux Power Holdings |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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