Correlation Between WK Kellogg and Escalade Incorporated
Can any of the company-specific risk be diversified away by investing in both WK Kellogg and Escalade Incorporated 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 WK Kellogg and Escalade Incorporated into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between WK Kellogg Co and Escalade Incorporated, you can compare the effects of market volatilities on WK Kellogg and Escalade Incorporated 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 WK Kellogg with a short position of Escalade Incorporated. Check out your portfolio center. Please also check ongoing floating volatility patterns of WK Kellogg and Escalade Incorporated.
Diversification Opportunities for WK Kellogg and Escalade Incorporated
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KLG and Escalade is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding WK Kellogg Co and Escalade Incorporated in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Escalade Incorporated and WK Kellogg 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 WK Kellogg Co are associated (or correlated) with Escalade Incorporated. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Escalade Incorporated has no effect on the direction of WK Kellogg i.e., WK Kellogg and Escalade Incorporated go up and down completely randomly.
Pair Corralation between WK Kellogg and Escalade Incorporated
Considering the 90-day investment horizon WK Kellogg Co is expected to under-perform the Escalade Incorporated. But the stock apears to be less risky and, when comparing its historical volatility, WK Kellogg Co is 1.16 times less risky than Escalade Incorporated. The stock trades about -0.07 of its potential returns per unit of risk. The Escalade Incorporated is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 1,327 in Escalade Incorporated on March 7, 2024 and sell it today you would earn a total of 24.00 from holding Escalade Incorporated or generate 1.81% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
WK Kellogg Co vs. Escalade Incorporated
Performance |
Timeline |
WK Kellogg |
Escalade Incorporated |
WK Kellogg and Escalade Incorporated Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with WK Kellogg and Escalade Incorporated
The main advantage of trading using opposite WK Kellogg and Escalade Incorporated positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if WK Kellogg position performs unexpectedly, Escalade Incorporated 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 Escalade Incorporated will offset losses from the drop in Escalade Incorporated's long position.WK Kellogg vs. Seneca Foods Corp | WK Kellogg vs. Central Garden Pet | WK Kellogg vs. Central Garden Pet | WK Kellogg vs. Lifevantage |
Escalade Incorporated vs. Vista Outdoor | Escalade Incorporated vs. Cedar Fair LP | Escalade Incorporated vs. Six Flags Entertainment | Escalade Incorporated vs. Acushnet Holdings 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
Bonds Directory Find actively traded corporate debentures issued by US companies | |
Stocks Directory Find actively traded stocks across global markets | |
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |