Correlation Between KVH Industries and ClearSign Combustion
Can any of the company-specific risk be diversified away by investing in both KVH Industries and ClearSign Combustion 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 KVH Industries and ClearSign Combustion into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KVH Industries and ClearSign Combustion, you can compare the effects of market volatilities on KVH Industries and ClearSign Combustion 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 KVH Industries with a short position of ClearSign Combustion. Check out your portfolio center. Please also check ongoing floating volatility patterns of KVH Industries and ClearSign Combustion.
Diversification Opportunities for KVH Industries and ClearSign Combustion
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between KVH and ClearSign is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding KVH Industries and ClearSign Combustion in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ClearSign Combustion and KVH Industries 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 KVH Industries are associated (or correlated) with ClearSign Combustion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ClearSign Combustion has no effect on the direction of KVH Industries i.e., KVH Industries and ClearSign Combustion go up and down completely randomly.
Pair Corralation between KVH Industries and ClearSign Combustion
Given the investment horizon of 90 days KVH Industries is expected to generate 1.79 times less return on investment than ClearSign Combustion. But when comparing it to its historical volatility, KVH Industries is 3.07 times less risky than ClearSign Combustion. It trades about 0.44 of its potential returns per unit of risk. ClearSign Combustion is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 88.00 in ClearSign Combustion on September 2, 2024 and sell it today you would earn a total of 30.00 from holding ClearSign Combustion or generate 34.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KVH Industries vs. ClearSign Combustion
Performance |
| Timeline |
| KVH Industries |
| ClearSign Combustion |
KVH Industries and ClearSign Combustion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KVH Industries and ClearSign Combustion
The main advantage of trading using opposite KVH Industries and ClearSign Combustion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KVH Industries position performs unexpectedly, ClearSign Combustion 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 ClearSign Combustion will offset losses from the drop in ClearSign Combustion's long position.| KVH Industries vs. Telesat Corp | KVH Industries vs. Comtech Telecommunications Corp | KVH Industries vs. Knowles Cor | KVH Industries vs. Ituran Location and |
| ClearSign Combustion vs. Knowles Cor | ClearSign Combustion vs. Ubiquiti Networks | ClearSign Combustion vs. AmpliTech Group | ClearSign Combustion vs. Viavi Solutions |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |