Correlation Between Knife River and CARPENTER
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By analyzing existing cross correlation between Knife River and CARPENTER TECHNOLOGY P, you can compare the effects of market volatilities on Knife River and CARPENTER 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 CARPENTER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Knife River and CARPENTER.
Diversification Opportunities for Knife River and CARPENTER
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Knife and CARPENTER is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Knife River and CARPENTER TECHNOLOGY P in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CARPENTER TECHNOLOGY 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 CARPENTER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CARPENTER TECHNOLOGY has no effect on the direction of Knife River i.e., Knife River and CARPENTER go up and down completely randomly.
Pair Corralation between Knife River and CARPENTER
Considering the 90-day investment horizon Knife River is expected to generate 4.79 times more return on investment than CARPENTER. However, Knife River is 4.79 times more volatile than CARPENTER TECHNOLOGY P. It trades about 0.32 of its potential returns per unit of risk. CARPENTER TECHNOLOGY P is currently generating about -0.01 per unit of risk. If you would invest 9,651 in Knife River on September 13, 2024 and sell it today you would earn a total of 1,024 from holding Knife River or generate 10.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Knife River vs. CARPENTER TECHNOLOGY P
Performance |
| Timeline |
| Knife River |
| CARPENTER TECHNOLOGY |
Knife River and CARPENTER Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Knife River and CARPENTER
The main advantage of trading using opposite Knife River and CARPENTER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Knife River position performs unexpectedly, CARPENTER 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 CARPENTER will offset losses from the drop in CARPENTER's long position.| Knife River vs. Ecolab Inc | Knife River vs. Hudson Technologies | Knife River vs. The Mosaic | Knife River vs. Freedom Bank of |
| CARPENTER vs. HUTCHMED DRC | CARPENTER vs. The Coca Cola | CARPENTER vs. Amgen Inc | CARPENTER vs. enVVeno Medical Corp |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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