Correlation Between Know Labs and Trimble
Can any of the company-specific risk be diversified away by investing in both Know Labs and Trimble 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 Know Labs and Trimble into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Know Labs and Trimble, you can compare the effects of market volatilities on Know Labs and Trimble 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 Know Labs with a short position of Trimble. Check out your portfolio center. Please also check ongoing floating volatility patterns of Know Labs and Trimble.
Diversification Opportunities for Know Labs and Trimble
Excellent diversification
The 3 months correlation between Know and Trimble is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Know Labs and Trimble in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trimble and Know Labs 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 Know Labs are associated (or correlated) with Trimble. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trimble has no effect on the direction of Know Labs i.e., Know Labs and Trimble go up and down completely randomly.
Pair Corralation between Know Labs and Trimble
Considering the 90-day investment horizon Know Labs is expected to generate 1.27 times more return on investment than Trimble. However, Know Labs is 1.27 times more volatile than Trimble. It trades about 0.22 of its potential returns per unit of risk. Trimble is currently generating about 0.21 per unit of risk. If you would invest 20.00 in Know Labs on August 24, 2024 and sell it today you would earn a total of 5.05 from holding Know Labs or generate 25.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Know Labs vs. Trimble
Performance |
| Timeline |
| Know Labs |
| Trimble |
Know Labs and Trimble Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Know Labs and Trimble
The main advantage of trading using opposite Know Labs and Trimble positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Know Labs position performs unexpectedly, Trimble 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 Trimble will offset losses from the drop in Trimble's long position.| Know Labs vs. Wearable Devices | Know Labs vs. Yoshiharu Global Co | Know Labs vs. bioAffinity Technologies, | Know Labs vs. Jianzhi Education Technology |
| Trimble vs. Fortive Corp | Trimble vs. MKS Instruments | Trimble vs. Novanta | Trimble vs. Vishay Precision Group |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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