Correlation Between KVH Industries and Eastman Kodak
Can any of the company-specific risk be diversified away by investing in both KVH Industries and Eastman Kodak 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 Eastman Kodak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KVH Industries and Eastman Kodak Co, you can compare the effects of market volatilities on KVH Industries and Eastman Kodak 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 Eastman Kodak. Check out your portfolio center. Please also check ongoing floating volatility patterns of KVH Industries and Eastman Kodak.
Diversification Opportunities for KVH Industries and Eastman Kodak
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between KVH and Eastman is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding KVH Industries and Eastman Kodak Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastman Kodak 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 Eastman Kodak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastman Kodak has no effect on the direction of KVH Industries i.e., KVH Industries and Eastman Kodak go up and down completely randomly.
Pair Corralation between KVH Industries and Eastman Kodak
Given the investment horizon of 90 days KVH Industries is expected to under-perform the Eastman Kodak. But the stock apears to be less risky and, when comparing its historical volatility, KVH Industries is 1.47 times less risky than Eastman Kodak. The stock trades about -0.03 of its potential returns per unit of risk. The Eastman Kodak Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 524.00 in Eastman Kodak Co on August 31, 2024 and sell it today you would earn a total of 201.00 from holding Eastman Kodak Co or generate 38.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KVH Industries vs. Eastman Kodak Co
Performance |
| Timeline |
| KVH Industries |
| Eastman Kodak |
KVH Industries and Eastman Kodak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KVH Industries and Eastman Kodak
The main advantage of trading using opposite KVH Industries and Eastman Kodak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KVH Industries position performs unexpectedly, Eastman Kodak 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 Eastman Kodak will offset losses from the drop in Eastman Kodak'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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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