Correlation Between Knowles Cor and Franklin Wireless
Can any of the company-specific risk be diversified away by investing in both Knowles Cor and Franklin Wireless 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 Knowles Cor and Franklin Wireless into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Knowles Cor and Franklin Wireless Corp, you can compare the effects of market volatilities on Knowles Cor and Franklin Wireless 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 Knowles Cor with a short position of Franklin Wireless. Check out your portfolio center. Please also check ongoing floating volatility patterns of Knowles Cor and Franklin Wireless.
Diversification Opportunities for Knowles Cor and Franklin Wireless
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Knowles and Franklin is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Knowles Cor and Franklin Wireless Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Wireless Corp and Knowles Cor 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 Knowles Cor are associated (or correlated) with Franklin Wireless. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Wireless Corp has no effect on the direction of Knowles Cor i.e., Knowles Cor and Franklin Wireless go up and down completely randomly.
Pair Corralation between Knowles Cor and Franklin Wireless
Allowing for the 90-day total investment horizon Knowles Cor is expected to generate 1.31 times more return on investment than Franklin Wireless. However, Knowles Cor is 1.31 times more volatile than Franklin Wireless Corp. It trades about 0.08 of its potential returns per unit of risk. Franklin Wireless Corp is currently generating about -0.11 per unit of risk. If you would invest 1,803 in Knowles Cor on August 30, 2024 and sell it today you would earn a total of 121.00 from holding Knowles Cor or generate 6.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Knowles Cor vs. Franklin Wireless Corp
Performance |
| Timeline |
| Knowles Cor |
| Franklin Wireless Corp |
Knowles Cor and Franklin Wireless Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Knowles Cor and Franklin Wireless
The main advantage of trading using opposite Knowles Cor and Franklin Wireless positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Knowles Cor position performs unexpectedly, Franklin Wireless 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 Franklin Wireless will offset losses from the drop in Franklin Wireless' long position.| Knowles Cor vs. Mynaric AG ADR | Knowles Cor vs. Comtech Telecommunications Corp | Knowles Cor vs. Ituran Location and | Knowles Cor vs. Aviat Networks |
| Franklin Wireless vs. Knowles Cor | Franklin Wireless vs. AudioCodes | Franklin Wireless vs. Ituran Location and | Franklin Wireless vs. Aviat Networks |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |