Correlation Between Kontoor Brands and Service
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By analyzing existing cross correlation between Kontoor Brands and Service Properties Trust, you can compare the effects of market volatilities on Kontoor Brands and Service 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 Service. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kontoor Brands and Service.
Diversification Opportunities for Kontoor Brands and Service
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kontoor and Service is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Kontoor Brands and Service Properties Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Service Properties Trust 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 Service. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Service Properties Trust has no effect on the direction of Kontoor Brands i.e., Kontoor Brands and Service go up and down completely randomly.
Pair Corralation between Kontoor Brands and Service
Considering the 90-day investment horizon Kontoor Brands is expected to generate 9.37 times less return on investment than Service. But when comparing it to its historical volatility, Kontoor Brands is 19.66 times less risky than Service. It trades about 0.09 of its potential returns per unit of risk. Service Properties Trust is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 8,028 in Service Properties Trust on September 13, 2024 and sell it today you would earn a total of 1,285 from holding Service Properties Trust or generate 16.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.76% |
| Values | Daily Returns |
Kontoor Brands vs. Service Properties Trust
Performance |
| Timeline |
| Kontoor Brands |
| Service Properties Trust |
Kontoor Brands and Service Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kontoor Brands and Service
The main advantage of trading using opposite Kontoor Brands and Service positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kontoor Brands position performs unexpectedly, Service 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 Service will offset losses from the drop in Service'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 |
| Service vs. BioNTech SE | Service vs. Highway Holdings Limited | Service vs. Catalyst Pharmaceuticals | Service vs. Park Ohio 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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