Correlation Between Koss and Emerson Radio
Can any of the company-specific risk be diversified away by investing in both Koss and Emerson Radio 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 Koss and Emerson Radio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koss Corporation and Emerson Radio, you can compare the effects of market volatilities on Koss and Emerson Radio 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 Koss with a short position of Emerson Radio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koss and Emerson Radio.
Diversification Opportunities for Koss and Emerson Radio
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Koss and Emerson is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Koss Corp. and Emerson Radio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerson Radio and Koss 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 Koss Corporation are associated (or correlated) with Emerson Radio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerson Radio has no effect on the direction of Koss i.e., Koss and Emerson Radio go up and down completely randomly.
Pair Corralation between Koss and Emerson Radio
Given the investment horizon of 90 days Koss Corporation is expected to under-perform the Emerson Radio. But the stock apears to be less risky and, when comparing its historical volatility, Koss Corporation is 1.4 times less risky than Emerson Radio. The stock trades about -0.27 of its potential returns per unit of risk. The Emerson Radio is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 54.00 in Emerson Radio on January 24, 2024 and sell it today you would earn a total of 0.00 from holding Emerson Radio or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koss Corp. vs. Emerson Radio
Performance |
| Timeline |
| Koss |
| Emerson Radio |
Koss and Emerson Radio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koss and Emerson Radio
The main advantage of trading using opposite Koss and Emerson Radio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koss position performs unexpectedly, Emerson Radio 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 Emerson Radio will offset losses from the drop in Emerson Radio's long position.| Koss vs. Brunswick | Koss vs. Ralph Lauren Corp | Koss vs. Under Armour C | Koss vs. Dogness International Corp |
| Emerson Radio vs. Brunswick | Emerson Radio vs. Ralph Lauren Corp | Emerson Radio vs. Under Armour C | Emerson Radio vs. Dogness International Corp |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets |