Correlation Between Kandi Technologies and Malibu Boats
Can any of the company-specific risk be diversified away by investing in both Kandi Technologies and Malibu Boats 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 Kandi Technologies and Malibu Boats into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kandi Technologies Group and Malibu Boats, you can compare the effects of market volatilities on Kandi Technologies and Malibu Boats 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 Kandi Technologies with a short position of Malibu Boats. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kandi Technologies and Malibu Boats.
Diversification Opportunities for Kandi Technologies and Malibu Boats
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kandi and Malibu is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Kandi Technologies Group and Malibu Boats in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Malibu Boats and Kandi 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 Kandi Technologies Group are associated (or correlated) with Malibu Boats. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Malibu Boats has no effect on the direction of Kandi Technologies i.e., Kandi Technologies and Malibu Boats go up and down completely randomly.
Pair Corralation between Kandi Technologies and Malibu Boats
Given the investment horizon of 90 days Kandi Technologies Group is expected to generate 1.51 times more return on investment than Malibu Boats. However, Kandi Technologies is 1.51 times more volatile than Malibu Boats. It trades about 0.1 of its potential returns per unit of risk. Malibu Boats is currently generating about -0.1 per unit of risk. If you would invest 209.00 in Kandi Technologies Group on February 12, 2024 and sell it today you would earn a total of 15.00 from holding Kandi Technologies Group or generate 7.18% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Kandi Technologies Group vs. Malibu Boats
Performance |
Timeline |
Kandi Technologies |
Malibu Boats |
Kandi Technologies and Malibu Boats Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Kandi Technologies and Malibu Boats
The main advantage of trading using opposite Kandi Technologies and Malibu Boats positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kandi Technologies position performs unexpectedly, Malibu Boats 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 Malibu Boats will offset losses from the drop in Malibu Boats' long position.Kandi Technologies vs. Hyliion Holdings Corp | Kandi Technologies vs. Foresight Autonomous Holdings | Kandi Technologies vs. Aeva Technologies | Kandi Technologies vs. Aeye Inc |
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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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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