Correlation Between Kontoor Brands and Inflection Point
Can any of the company-specific risk be diversified away by investing in both Kontoor Brands and Inflection Point 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 Kontoor Brands and Inflection Point into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kontoor Brands and Inflection Point Acquisition, you can compare the effects of market volatilities on Kontoor Brands and Inflection Point 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 Kontoor Brands with a short position of Inflection Point. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kontoor Brands and Inflection Point.
Diversification Opportunities for Kontoor Brands and Inflection Point
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kontoor and Inflection is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Kontoor Brands and Inflection Point Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inflection Point Acq and Kontoor Brands 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 Kontoor Brands are associated (or correlated) with Inflection Point. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inflection Point Acq has no effect on the direction of Kontoor Brands i.e., Kontoor Brands and Inflection Point go up and down completely randomly.
Pair Corralation between Kontoor Brands and Inflection Point
Considering the 90-day investment horizon Kontoor Brands is expected to under-perform the Inflection Point. But the stock apears to be less risky and, when comparing its historical volatility, Kontoor Brands is 3.22 times less risky than Inflection Point. The stock trades about -0.03 of its potential returns per unit of risk. The Inflection Point Acquisition is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,086 in Inflection Point Acquisition on September 15, 2024 and sell it today you would earn a total of 249.00 from holding Inflection Point Acquisition or generate 22.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kontoor Brands vs. Inflection Point Acquisition
Performance |
| Timeline |
| Kontoor Brands |
| Inflection Point Acq |
Kontoor Brands and Inflection Point Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kontoor Brands and Inflection Point
The main advantage of trading using opposite Kontoor Brands and Inflection Point positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kontoor Brands position performs unexpectedly, Inflection Point 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 Inflection Point will offset losses from the drop in Inflection Point's long position.| Kontoor Brands vs. Vince Holding Corp | Kontoor Brands vs. Ermenegildo Zegna NV | Kontoor Brands vs. Columbia Sportswear | Kontoor Brands vs. Gildan Activewear |
| Inflection Point vs. Skechers USA | Inflection Point vs. Kontoor Brands | Inflection Point vs. Boot Barn Holdings | Inflection Point vs. Canada Goose Holdings |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |