Correlation Between Knightscope and Federal Natl
Can any of the company-specific risk be diversified away by investing in both Knightscope and Federal Natl 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 Knightscope and Federal Natl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Knightscope and Federal Natl Mtg, you can compare the effects of market volatilities on Knightscope and Federal Natl 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 Knightscope with a short position of Federal Natl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Knightscope and Federal Natl.
Diversification Opportunities for Knightscope and Federal Natl
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Knightscope and Federal is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Knightscope and Federal Natl Mtg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federal Natl Mtg and Knightscope 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 Knightscope are associated (or correlated) with Federal Natl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federal Natl Mtg has no effect on the direction of Knightscope i.e., Knightscope and Federal Natl go up and down completely randomly.
Pair Corralation between Knightscope and Federal Natl
Given the investment horizon of 90 days Knightscope is expected to under-perform the Federal Natl. In addition to that, Knightscope is 1.62 times more volatile than Federal Natl Mtg. It trades about 0.0 of its total potential returns per unit of risk. Federal Natl Mtg is currently generating about 0.09 per unit of volatility. If you would invest 185.00 in Federal Natl Mtg on November 21, 2024 and sell it today you would earn a total of 785.00 from holding Federal Natl Mtg or generate 424.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Knightscope vs. Federal Natl Mtg
Performance |
| Timeline |
| Knightscope |
| Federal Natl Mtg |
Knightscope and Federal Natl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Knightscope and Federal Natl
The main advantage of trading using opposite Knightscope and Federal Natl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Knightscope position performs unexpectedly, Federal Natl 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 Federal Natl will offset losses from the drop in Federal Natl's long position.| Knightscope vs. LogicMark | Knightscope vs. Guardforce AI Co | Knightscope vs. Bridger Aerospace Group | Knightscope vs. Iveda Solutions |
| Federal Natl vs. Federal National Mortgage | Federal Natl vs. Federal Home Loan | Federal Natl vs. Federal National Mortgage | Federal Natl vs. Federal National Mortgage |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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