Correlation Between KVH Industries and Nextplat Corp
Can any of the company-specific risk be diversified away by investing in both KVH Industries and Nextplat 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 Nextplat 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 Nextplat Corp, you can compare the effects of market volatilities on KVH Industries and Nextplat 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 Nextplat Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of KVH Industries and Nextplat Corp.
Diversification Opportunities for KVH Industries and Nextplat Corp
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between KVH and Nextplat is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding KVH Industries and Nextplat Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nextplat 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 Nextplat Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nextplat Corp has no effect on the direction of KVH Industries i.e., KVH Industries and Nextplat Corp go up and down completely randomly.
Pair Corralation between KVH Industries and Nextplat Corp
Given the investment horizon of 90 days KVH Industries is expected to under-perform the Nextplat Corp. But the stock apears to be less risky and, when comparing its historical volatility, KVH Industries is 1.72 times less risky than Nextplat Corp. The stock trades about -0.03 of its potential returns per unit of risk. The Nextplat Corp is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 152.00 in Nextplat Corp on August 27, 2024 and sell it today you would lose (58.00) from holding Nextplat Corp or give up 38.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KVH Industries vs. Nextplat Corp
Performance |
| Timeline |
| KVH Industries |
| Nextplat Corp |
KVH Industries and Nextplat Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KVH Industries and Nextplat Corp
The main advantage of trading using opposite KVH Industries and Nextplat Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KVH Industries position performs unexpectedly, Nextplat 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 Nextplat Corp will offset losses from the drop in Nextplat Corp's long position.| KVH Industries vs. Ichor Holdings | KVH Industries vs. Fabrinet | KVH Industries vs. Hello Group | KVH Industries vs. Ultra Clean Holdings |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities |