Correlation Between Keck Seng and Mueller Industries
Can any of the company-specific risk be diversified away by investing in both Keck Seng and Mueller Industries 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 Keck Seng and Mueller Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Keck Seng Investments and Mueller Industries, you can compare the effects of market volatilities on Keck Seng and Mueller Industries 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 Keck Seng with a short position of Mueller Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keck Seng and Mueller Industries.
Diversification Opportunities for Keck Seng and Mueller Industries
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Keck and Mueller is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Keck Seng Investments and Mueller Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mueller Industries and Keck Seng 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 Keck Seng Investments are associated (or correlated) with Mueller Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mueller Industries has no effect on the direction of Keck Seng i.e., Keck Seng and Mueller Industries go up and down completely randomly.
Pair Corralation between Keck Seng and Mueller Industries
Assuming the 90 days horizon Keck Seng Investments is expected to generate 2.24 times more return on investment than Mueller Industries. However, Keck Seng is 2.24 times more volatile than Mueller Industries. It trades about 0.09 of its potential returns per unit of risk. Mueller Industries is currently generating about 0.03 per unit of risk. If you would invest 23.00 in Keck Seng Investments on October 28, 2024 and sell it today you would earn a total of 3.00 from holding Keck Seng Investments or generate 13.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Keck Seng Investments vs. Mueller Industries
Performance |
| Timeline |
| Keck Seng Investments |
| Mueller Industries |
Keck Seng and Mueller Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Keck Seng and Mueller Industries
The main advantage of trading using opposite Keck Seng and Mueller Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keck Seng position performs unexpectedly, Mueller Industries 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 Mueller Industries will offset losses from the drop in Mueller Industries' long position.| Keck Seng vs. ASURE SOFTWARE | Keck Seng vs. Urban Outfitters | Keck Seng vs. JAPAN TOBACCO UNSPADR12 | Keck Seng vs. Japan Tobacco |
| Mueller Industries vs. MCEWEN MINING INC | Mueller Industries vs. MINCO SILVER | Mueller Industries vs. Broadcom | Mueller Industries vs. Liberty Broadband |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing |