Correlation Between Lifetime Brands and Kimball International
Can any of the company-specific risk be diversified away by investing in both Lifetime Brands and Kimball International 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 Lifetime Brands and Kimball International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lifetime Brands and Kimball International, you can compare the effects of market volatilities on Lifetime Brands and Kimball International 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 Lifetime Brands with a short position of Kimball International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lifetime Brands and Kimball International.
Diversification Opportunities for Lifetime Brands and Kimball International
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lifetime and Kimball is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Lifetime Brands and Kimball International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kimball International and Lifetime Brands 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 Lifetime Brands are associated (or correlated) with Kimball International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kimball International has no effect on the direction of Lifetime Brands i.e., Lifetime Brands and Kimball International go up and down completely randomly.
Pair Corralation between Lifetime Brands and Kimball International
Given the investment horizon of 90 days Lifetime Brands is expected to generate 136.91 times less return on investment than Kimball International. But when comparing it to its historical volatility, Lifetime Brands is 2.12 times less risky than Kimball International. It trades about 0.0 of its potential returns per unit of risk. Kimball International is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 611.00 in Kimball International on September 2, 2024 and sell it today you would earn a total of 619.00 from holding Kimball International or generate 101.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 24.8% |
| Values | Daily Returns |
Lifetime Brands vs. Kimball International
Performance |
| Timeline |
| Lifetime Brands |
| Kimball International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Lifetime Brands and Kimball International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lifetime Brands and Kimball International
The main advantage of trading using opposite Lifetime Brands and Kimball International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lifetime Brands position performs unexpectedly, Kimball International 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 Kimball International will offset losses from the drop in Kimball International's long position.| Lifetime Brands vs. Bassett Furniture Industries | Lifetime Brands vs. Flexsteel Industries | Lifetime Brands vs. Hamilton Beach Brands | Lifetime Brands vs. Natuzzi SpA |
| Kimball International vs. Kimball Electronics | Kimball International vs. Interface | Kimball International vs. James River Group | Kimball International vs. Midland States Bancorp |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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