Correlation Between AVX and Kimball Electronics
Can any of the company-specific risk be diversified away by investing in both AVX and Kimball Electronics 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 AVX and Kimball Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AVX Corporation and Kimball Electronics, you can compare the effects of market volatilities on AVX and Kimball Electronics 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 AVX with a short position of Kimball Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of AVX and Kimball Electronics.
Diversification Opportunities for AVX and Kimball Electronics
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between AVX and Kimball is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding AVX Corp. and Kimball Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kimball Electronics and AVX 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 AVX Corporation are associated (or correlated) with Kimball Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kimball Electronics has no effect on the direction of AVX i.e., AVX and Kimball Electronics go up and down completely randomly.
Pair Corralation between AVX and Kimball Electronics
If you would invest 2,030 in Kimball Electronics on January 25, 2024 and sell it today you would earn a total of 66.00 from holding Kimball Electronics or generate 3.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
AVX Corp. vs. Kimball Electronics
Performance |
| Timeline |
| AVX Corporation |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Kimball Electronics |
AVX and Kimball Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AVX and Kimball Electronics
The main advantage of trading using opposite AVX and Kimball Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AVX position performs unexpectedly, Kimball Electronics 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 Electronics will offset losses from the drop in Kimball Electronics' long position.The idea behind AVX Corporation and Kimball Electronics pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Kimball Electronics vs. Hayward Holdings | Kimball Electronics vs. Hollysys Automation Technologies | Kimball Electronics vs. Enersys | Kimball Electronics vs. Espey Mfg Electronics |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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