Correlation Between MillerKnoll and Automatic Data
Can any of the company-specific risk be diversified away by investing in both MillerKnoll and Automatic Data 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 MillerKnoll and Automatic Data into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MillerKnoll and Automatic Data Processing, you can compare the effects of market volatilities on MillerKnoll and Automatic Data 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 MillerKnoll with a short position of Automatic Data. Check out your portfolio center. Please also check ongoing floating volatility patterns of MillerKnoll and Automatic Data.
Diversification Opportunities for MillerKnoll and Automatic Data
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between MillerKnoll and Automatic is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding MillerKnoll and Automatic Data Processing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Automatic Data Processing and MillerKnoll 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 MillerKnoll are associated (or correlated) with Automatic Data. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Automatic Data Processing has no effect on the direction of MillerKnoll i.e., MillerKnoll and Automatic Data go up and down completely randomly.
Pair Corralation between MillerKnoll and Automatic Data
Given the investment horizon of 90 days MillerKnoll is expected to generate 1.52 times more return on investment than Automatic Data. However, MillerKnoll is 1.52 times more volatile than Automatic Data Processing. It trades about 0.19 of its potential returns per unit of risk. Automatic Data Processing is currently generating about 0.22 per unit of risk. If you would invest 2,360 in MillerKnoll on August 28, 2024 and sell it today you would earn a total of 193.00 from holding MillerKnoll or generate 8.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MillerKnoll vs. Automatic Data Processing
Performance |
| Timeline |
| MillerKnoll |
| Automatic Data Processing |
MillerKnoll and Automatic Data Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MillerKnoll and Automatic Data
The main advantage of trading using opposite MillerKnoll and Automatic Data positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MillerKnoll position performs unexpectedly, Automatic Data 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 Automatic Data will offset losses from the drop in Automatic Data's long position.| MillerKnoll vs. Bassett Furniture Industries | MillerKnoll vs. Ethan Allen Interiors | MillerKnoll vs. Natuzzi SpA | MillerKnoll vs. Flexsteel Industries |
| Automatic Data vs. Robert Half International | Automatic Data vs. Barrett Business Services | Automatic Data vs. ManpowerGroup | Automatic Data vs. Kforce Inc |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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