Correlation Between Kneat and Pulse Seismic
Can any of the company-specific risk be diversified away by investing in both Kneat and Pulse Seismic 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 Kneat and Pulse Seismic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kneat Inc and Pulse Seismic, you can compare the effects of market volatilities on Kneat and Pulse Seismic 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 Kneat with a short position of Pulse Seismic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kneat and Pulse Seismic.
Diversification Opportunities for Kneat and Pulse Seismic
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kneat and Pulse is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Kneat Inc and Pulse Seismic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pulse Seismic and Kneat 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 Kneat Inc are associated (or correlated) with Pulse Seismic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pulse Seismic has no effect on the direction of Kneat i.e., Kneat and Pulse Seismic go up and down completely randomly.
Pair Corralation between Kneat and Pulse Seismic
Assuming the 90 days trading horizon Kneat Inc is expected to generate 1.08 times more return on investment than Pulse Seismic. However, Kneat is 1.08 times more volatile than Pulse Seismic. It trades about 0.3 of its potential returns per unit of risk. Pulse Seismic is currently generating about 0.04 per unit of risk. If you would invest 480.00 in Kneat Inc on August 31, 2024 and sell it today you would earn a total of 79.00 from holding Kneat Inc or generate 16.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Kneat Inc vs. Pulse Seismic
Performance |
| Timeline |
| Kneat Inc |
| Pulse Seismic |
Kneat and Pulse Seismic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kneat and Pulse Seismic
The main advantage of trading using opposite Kneat and Pulse Seismic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kneat position performs unexpectedly, Pulse Seismic 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 Pulse Seismic will offset losses from the drop in Pulse Seismic's long position.The idea behind Kneat Inc and Pulse Seismic pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Pulse Seismic vs. Pason Systems | Pulse Seismic vs. Enerflex | Pulse Seismic vs. Quarterhill | Pulse Seismic vs. Westaim 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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets |