Correlation Between Knife River and Intel
Can any of the company-specific risk be diversified away by investing in both Knife River and Intel 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 Knife River and Intel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Knife River and Intel, you can compare the effects of market volatilities on Knife River and Intel 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 Knife River with a short position of Intel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Knife River and Intel.
Diversification Opportunities for Knife River and Intel
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Knife and Intel is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Knife River and Intel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intel and Knife River 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 Knife River are associated (or correlated) with Intel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intel has no effect on the direction of Knife River i.e., Knife River and Intel go up and down completely randomly.
Pair Corralation between Knife River and Intel
Considering the 90-day investment horizon Knife River is expected to generate 0.89 times more return on investment than Intel. However, Knife River is 1.12 times less risky than Intel. It trades about 0.14 of its potential returns per unit of risk. Intel is currently generating about 0.03 per unit of risk. If you would invest 9,575 in Knife River on August 29, 2024 and sell it today you would earn a total of 883.00 from holding Knife River or generate 9.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Knife River vs. Intel
Performance |
| Timeline |
| Knife River |
| Intel |
Knife River and Intel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Knife River and Intel
The main advantage of trading using opposite Knife River and Intel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Knife River position performs unexpectedly, Intel 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 Intel will offset losses from the drop in Intel's long position.| Knife River vs. Cemex SAB de | Knife River vs. Boise Cascad Llc | Knife River vs. CRH PLC ADR | Knife River vs. Eagle Materials |
| Intel vs. ABIVAX Socit Anonyme | Intel vs. Morningstar Unconstrained Allocation | Intel vs. SPACE | Intel vs. Knife River |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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