Correlation Between Palantir Technologies and Knorr-Bremse Aktiengesellscha
Can any of the company-specific risk be diversified away by investing in both Palantir Technologies and Knorr-Bremse Aktiengesellscha 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 Palantir Technologies and Knorr-Bremse Aktiengesellscha into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Palantir Technologies Class and Knorr Bremse Aktiengesellschaft, you can compare the effects of market volatilities on Palantir Technologies and Knorr-Bremse Aktiengesellscha 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 Palantir Technologies with a short position of Knorr-Bremse Aktiengesellscha. Check out your portfolio center. Please also check ongoing floating volatility patterns of Palantir Technologies and Knorr-Bremse Aktiengesellscha.
Diversification Opportunities for Palantir Technologies and Knorr-Bremse Aktiengesellscha
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Palantir and Knorr-Bremse is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Palantir Technologies Class and Knorr Bremse Aktiengesellschaf in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Knorr-Bremse Aktiengesellscha and Palantir Technologies 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 Palantir Technologies Class are associated (or correlated) with Knorr-Bremse Aktiengesellscha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Knorr-Bremse Aktiengesellscha has no effect on the direction of Palantir Technologies i.e., Palantir Technologies and Knorr-Bremse Aktiengesellscha go up and down completely randomly.
Pair Corralation between Palantir Technologies and Knorr-Bremse Aktiengesellscha
Given the investment horizon of 90 days Palantir Technologies Class is expected to generate 2.41 times more return on investment than Knorr-Bremse Aktiengesellscha. However, Palantir Technologies is 2.41 times more volatile than Knorr Bremse Aktiengesellschaft. It trades about 0.15 of its potential returns per unit of risk. Knorr Bremse Aktiengesellschaft is currently generating about 0.07 per unit of risk. If you would invest 1,777 in Palantir Technologies Class on September 4, 2024 and sell it today you would earn a total of 4,862 from holding Palantir Technologies Class or generate 273.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
Palantir Technologies Class vs. Knorr Bremse Aktiengesellschaf
Performance |
| Timeline |
| Palantir Technologies |
| Knorr-Bremse Aktiengesellscha |
Palantir Technologies and Knorr-Bremse Aktiengesellscha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Palantir Technologies and Knorr-Bremse Aktiengesellscha
The main advantage of trading using opposite Palantir Technologies and Knorr-Bremse Aktiengesellscha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Palantir Technologies position performs unexpectedly, Knorr-Bremse Aktiengesellscha 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 Knorr-Bremse Aktiengesellscha will offset losses from the drop in Knorr-Bremse Aktiengesellscha's long position.| Palantir Technologies vs. Palo Alto Networks | Palantir Technologies vs. Adobe Systems Incorporated | Palantir Technologies vs. Crowdstrike Holdings | Palantir Technologies vs. Block 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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