Correlation Between Kewaunee Scientific and IRobot
Can any of the company-specific risk be diversified away by investing in both Kewaunee Scientific and IRobot 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 Kewaunee Scientific and IRobot into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kewaunee Scientific and iRobot, you can compare the effects of market volatilities on Kewaunee Scientific and IRobot 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 Kewaunee Scientific with a short position of IRobot. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kewaunee Scientific and IRobot.
Diversification Opportunities for Kewaunee Scientific and IRobot
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kewaunee and IRobot is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Kewaunee Scientific and iRobot in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iRobot and Kewaunee Scientific 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 Kewaunee Scientific are associated (or correlated) with IRobot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iRobot has no effect on the direction of Kewaunee Scientific i.e., Kewaunee Scientific and IRobot go up and down completely randomly.
Pair Corralation between Kewaunee Scientific and IRobot
Given the investment horizon of 90 days Kewaunee Scientific is expected to generate 0.6 times more return on investment than IRobot. However, Kewaunee Scientific is 1.67 times less risky than IRobot. It trades about 0.07 of its potential returns per unit of risk. iRobot is currently generating about -0.02 per unit of risk. If you would invest 2,814 in Kewaunee Scientific on August 28, 2024 and sell it today you would earn a total of 1,440 from holding Kewaunee Scientific or generate 51.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kewaunee Scientific vs. iRobot
Performance |
| Timeline |
| Kewaunee Scientific |
| iRobot |
Kewaunee Scientific and IRobot Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kewaunee Scientific and IRobot
The main advantage of trading using opposite Kewaunee Scientific and IRobot positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kewaunee Scientific position performs unexpectedly, IRobot 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 IRobot will offset losses from the drop in IRobot's long position.| Kewaunee Scientific vs. Hamilton Beach Brands | Kewaunee Scientific vs. Mohawk Industries | Kewaunee Scientific vs. Whirlpool | Kewaunee Scientific vs. iRobot |
| IRobot vs. Tempur Sealy International | IRobot vs. La Z Boy Incorporated | IRobot vs. Purple Innovation | IRobot 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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Stocks Directory Find actively traded stocks across global markets | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like |