Correlation Between Kimball Electronics and Neonode
Can any of the company-specific risk be diversified away by investing in both Kimball Electronics and Neonode 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 Neonode into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kimball Electronics and Neonode, you can compare the effects of market volatilities on Kimball Electronics and Neonode 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 Neonode. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kimball Electronics and Neonode.
Diversification Opportunities for Kimball Electronics and Neonode
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kimball and Neonode is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Kimball Electronics and Neonode in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neonode 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 Neonode. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neonode has no effect on the direction of Kimball Electronics i.e., Kimball Electronics and Neonode go up and down completely randomly.
Pair Corralation between Kimball Electronics and Neonode
Allowing for the 90-day total investment horizon Kimball Electronics is expected to generate 1.23 times less return on investment than Neonode. But when comparing it to its historical volatility, Kimball Electronics is 3.59 times less risky than Neonode. It trades about 0.08 of its potential returns per unit of risk. Neonode is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 814.00 in Neonode on September 12, 2024 and sell it today you would lose (36.00) from holding Neonode or give up 4.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kimball Electronics vs. Neonode
Performance |
| Timeline |
| Kimball Electronics |
| Neonode |
Kimball Electronics and Neonode Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kimball Electronics and Neonode
The main advantage of trading using opposite Kimball Electronics and Neonode positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kimball Electronics position performs unexpectedly, Neonode 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 Neonode will offset losses from the drop in Neonode's long position.| Kimball Electronics vs. Hayward Holdings | Kimball Electronics vs. Enersys | Kimball Electronics vs. Espey Mfg Electronics | Kimball Electronics vs. Advanced Energy Industries |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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