Correlation Between Kubota Corp and Gencor Industries
Can any of the company-specific risk be diversified away by investing in both Kubota Corp and Gencor Industries 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 Kubota Corp and Gencor Industries into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kubota Corp ADR and Gencor Industries, you can compare the effects of market volatilities on Kubota Corp and Gencor Industries 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 Kubota Corp with a short position of Gencor Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kubota Corp and Gencor Industries.
Diversification Opportunities for Kubota Corp and Gencor Industries
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kubota and Gencor is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Kubota Corp ADR and Gencor Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gencor Industries and Kubota Corp 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 Kubota Corp ADR are associated (or correlated) with Gencor Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gencor Industries has no effect on the direction of Kubota Corp i.e., Kubota Corp and Gencor Industries go up and down completely randomly.
Pair Corralation between Kubota Corp and Gencor Industries
If you would invest 1,991 in Gencor Industries on August 28, 2024 and sell it today you would earn a total of 251.00 from holding Gencor Industries or generate 12.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 1.59% |
| Values | Daily Returns |
Kubota Corp ADR vs. Gencor Industries
Performance |
| Timeline |
| Kubota Corp ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Gencor Industries |
Kubota Corp and Gencor Industries Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kubota Corp and Gencor Industries
The main advantage of trading using opposite Kubota Corp and Gencor Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kubota Corp position performs unexpectedly, Gencor Industries 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 Gencor Industries will offset losses from the drop in Gencor Industries' long position.| Kubota Corp vs. Hitachi Construction Machinery | Kubota Corp vs. Terex | Kubota Corp vs. Komatsu | Kubota Corp vs. Astec Industries |
| Gencor Industries vs. Alamo Group | Gencor Industries vs. Manitowoc | Gencor Industries vs. Manitex International | Gencor Industries vs. Columbus McKinnon |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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