Correlation Between NYSE Composite and Knowles Cor
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Knowles Cor 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 NYSE Composite and Knowles Cor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Knowles Cor, you can compare the effects of market volatilities on NYSE Composite and Knowles Cor 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 NYSE Composite with a short position of Knowles Cor. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Knowles Cor.
Diversification Opportunities for NYSE Composite and Knowles Cor
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between NYSE and Knowles is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Knowles Cor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Knowles Cor and NYSE Composite 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 NYSE Composite are associated (or correlated) with Knowles Cor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Knowles Cor has no effect on the direction of NYSE Composite i.e., NYSE Composite and Knowles Cor go up and down completely randomly.
Pair Corralation between NYSE Composite and Knowles Cor
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.83 times less return on investment than Knowles Cor. But when comparing it to its historical volatility, NYSE Composite is 2.61 times less risky than Knowles Cor. It trades about 0.11 of its potential returns per unit of risk. Knowles Cor is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,754 in Knowles Cor on November 1, 2024 and sell it today you would earn a total of 141.00 from holding Knowles Cor or generate 8.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Knowles Cor
Performance |
| Timeline |
NYSE Composite and Knowles Cor Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Knowles Cor
Pair trading matchups for Knowles Cor
Pair Trading with NYSE Composite and Knowles Cor
The main advantage of trading using opposite NYSE Composite and Knowles Cor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Knowles Cor 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 Knowles Cor will offset losses from the drop in Knowles Cor's long position.| NYSE Composite vs. Western Copper and | NYSE Composite vs. Chemours Co | NYSE Composite vs. IPG Photonics | NYSE Composite vs. Morgan Advanced Materials |
| Knowles Cor vs. Mynaric AG ADR | Knowles Cor vs. Comtech Telecommunications Corp | Knowles Cor vs. Ituran Location and | Knowles Cor vs. Aviat Networks |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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