Correlation Between KION GROUP and Deere
Can any of the company-specific risk be diversified away by investing in both KION GROUP and Deere 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 KION GROUP and Deere into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KION GROUP AG and Deere Company, you can compare the effects of market volatilities on KION GROUP and Deere 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 KION GROUP with a short position of Deere. Check out your portfolio center. Please also check ongoing floating volatility patterns of KION GROUP and Deere.
Diversification Opportunities for KION GROUP and Deere
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KION and Deere is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding KION GROUP AG and Deere Company in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Deere Company and KION GROUP 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 KION GROUP AG are associated (or correlated) with Deere. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Deere Company has no effect on the direction of KION GROUP i.e., KION GROUP and Deere go up and down completely randomly.
Pair Corralation between KION GROUP and Deere
Assuming the 90 days horizon KION GROUP AG is expected to under-perform the Deere. In addition to that, KION GROUP is 1.1 times more volatile than Deere Company. It trades about -0.05 of its total potential returns per unit of risk. Deere Company is currently generating about 0.23 per unit of volatility. If you would invest 40,265 in Deere Company on September 12, 2024 and sell it today you would earn a total of 4,538 from holding Deere Company or generate 11.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KION GROUP AG vs. Deere Company
Performance |
| Timeline |
| KION GROUP AG |
| Deere Company |
KION GROUP and Deere Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KION GROUP and Deere
The main advantage of trading using opposite KION GROUP and Deere positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KION GROUP position performs unexpectedly, Deere 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 Deere will offset losses from the drop in Deere's long position.| KION GROUP vs. Caterpillar | KION GROUP vs. Deere Company | KION GROUP vs. Shyft Group | KION GROUP vs. Nikola Corp |
| Deere vs. Victory Integrity Smallmid Cap | Deere vs. Hilton Worldwide Holdings | Deere vs. NVIDIA | Deere vs. JPMorgan Chase Co |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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