Correlation Between KVH Industries and Ituran Location
Can any of the company-specific risk be diversified away by investing in both KVH Industries and Ituran Location 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 Ituran Location into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KVH Industries and Ituran Location and, you can compare the effects of market volatilities on KVH Industries and Ituran Location 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 Ituran Location. Check out your portfolio center. Please also check ongoing floating volatility patterns of KVH Industries and Ituran Location.
Diversification Opportunities for KVH Industries and Ituran Location
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between KVH and Ituran is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding KVH Industries and Ituran Location and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ituran Location 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 Ituran Location. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ituran Location has no effect on the direction of KVH Industries i.e., KVH Industries and Ituran Location go up and down completely randomly.
Pair Corralation between KVH Industries and Ituran Location
Given the investment horizon of 90 days KVH Industries is expected to generate 1.14 times less return on investment than Ituran Location. But when comparing it to its historical volatility, KVH Industries is 1.0 times less risky than Ituran Location. It trades about 0.35 of its potential returns per unit of risk. Ituran Location and is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest 2,899 in Ituran Location and on October 20, 2024 and sell it today you would earn a total of 410.00 from holding Ituran Location and or generate 14.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
KVH Industries vs. Ituran Location and
Performance |
| Timeline |
| KVH Industries |
| Ituran Location |
KVH Industries and Ituran Location Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KVH Industries and Ituran Location
The main advantage of trading using opposite KVH Industries and Ituran Location positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KVH Industries position performs unexpectedly, Ituran Location 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 Ituran Location will offset losses from the drop in Ituran Location'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 |
| Ituran Location vs. Silicom | Ituran Location vs. Allot Communications | Ituran Location vs. Sapiens International | Ituran Location vs. Formula Systems 1985 |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets |