Correlation Between Karat Packaging and ProShares
Can any of the company-specific risk be diversified away by investing in both Karat Packaging and ProShares 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 Karat Packaging and ProShares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Karat Packaging and ProShares SP Kensho, you can compare the effects of market volatilities on Karat Packaging and ProShares 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 Karat Packaging with a short position of ProShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Karat Packaging and ProShares.
Diversification Opportunities for Karat Packaging and ProShares
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Karat and ProShares is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Karat Packaging and ProShares SP Kensho in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ProShares SP Kensho and Karat Packaging 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 Karat Packaging are associated (or correlated) with ProShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ProShares SP Kensho has no effect on the direction of Karat Packaging i.e., Karat Packaging and ProShares go up and down completely randomly.
Pair Corralation between Karat Packaging and ProShares
Considering the 90-day investment horizon Karat Packaging is expected to generate 0.8 times more return on investment than ProShares. However, Karat Packaging is 1.26 times less risky than ProShares. It trades about 0.22 of its potential returns per unit of risk. ProShares SP Kensho is currently generating about -0.01 per unit of risk. If you would invest 2,553 in Karat Packaging on August 30, 2024 and sell it today you would earn a total of 493.00 from holding Karat Packaging or generate 19.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Karat Packaging vs. ProShares SP Kensho
Performance |
| Timeline |
| Karat Packaging |
| ProShares SP Kensho |
Karat Packaging and ProShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Karat Packaging and ProShares
The main advantage of trading using opposite Karat Packaging and ProShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Karat Packaging position performs unexpectedly, ProShares 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 ProShares will offset losses from the drop in ProShares' long position.| Karat Packaging vs. Greif Bros | Karat Packaging vs. Reynolds Consumer Products | Karat Packaging vs. Silgan Holdings | Karat Packaging vs. O I Glass |
| ProShares vs. Nexalin Technology | ProShares vs. Kilroy Realty Corp | ProShares vs. Highwoods Properties | ProShares vs. Karat Packaging |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |