Correlation Between Kaman and Eve Holding

Can any of the company-specific risk be diversified away by investing in both Kaman and Eve Holding 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 Kaman and Eve Holding into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Kaman and Eve Holding, you can compare the effects of market volatilities on Kaman and Eve Holding 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 Kaman with a short position of Eve Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaman and Eve Holding.

Diversification Opportunities for Kaman and Eve Holding

0.34

Correlation Coefficient

Kaman  Eve Holding

Weak diversification

The 3 months correlation between Kaman and Eve is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Kaman and Eve Holding in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eve Holding and Kaman 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 Kaman are associated (or correlated) with Eve Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eve Holding has no effect on the direction of Kaman i.e., Kaman and Eve Holding go up and down completely randomly.

Pair Corralation between Kaman and Eve Holding

If you would invest  273.00  in Eve Holding on September 5, 2024 and sell it today you would earn a total of  129.00  from holding Eve Holding or generate 47.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	1.18%
Values	Daily Returns

Kaman  vs.  Eve Holding

Kaman

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kaman has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy primary indicators, Kaman is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Eve Holding

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Eve Holding are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating technical and fundamental indicators, Eve Holding showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kaman and Eve Holding

The main advantage of trading using opposite Kaman and Eve Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaman position performs unexpectedly, Eve Holding 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 Eve Holding will offset losses from the drop in Eve Holding's long position.

The idea behind Kaman and Eve Holding 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.

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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.