Correlation Between KVH Industries and Imax Corp
Can any of the company-specific risk be diversified away by investing in both KVH Industries and Imax Corp 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 Imax Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KVH Industries and Imax Corp, you can compare the effects of market volatilities on KVH Industries and Imax Corp 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 Imax Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of KVH Industries and Imax Corp.
Diversification Opportunities for KVH Industries and Imax Corp
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between KVH and Imax is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding KVH Industries and Imax Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Imax Corp 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 Imax Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Imax Corp has no effect on the direction of KVH Industries i.e., KVH Industries and Imax Corp go up and down completely randomly.
Pair Corralation between KVH Industries and Imax Corp
Given the investment horizon of 90 days KVH Industries is expected to generate 1.92 times less return on investment than Imax Corp. In addition to that, KVH Industries is 1.01 times more volatile than Imax Corp. It trades about 0.06 of its total potential returns per unit of risk. Imax Corp is currently generating about 0.11 per unit of volatility. If you would invest 1,353 in Imax Corp on November 3, 2024 and sell it today you would earn a total of 1,002 from holding Imax Corp or generate 74.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KVH Industries vs. Imax Corp
Performance |
| Timeline |
| KVH Industries |
| Imax Corp |
KVH Industries and Imax Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KVH Industries and Imax Corp
The main advantage of trading using opposite KVH Industries and Imax Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KVH Industries position performs unexpectedly, Imax Corp 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 Imax Corp will offset losses from the drop in Imax Corp'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 |
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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