Correlation Between Korn Ferry and Robert Half

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

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

Diversification Opportunities for Korn Ferry and Robert Half

0.78

Correlation Coefficient

Korn Ferry  Robert Half

Poor diversification

The 3 months correlation between Korn and Robert is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Korn Ferry and Robert Half International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Robert Half International and Korn Ferry 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 Korn Ferry are associated (or correlated) with Robert Half. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Robert Half International has no effect on the direction of Korn Ferry i.e., Korn Ferry and Robert Half go up and down completely randomly.

Pair Corralation between Korn Ferry and Robert Half

Considering the 90-day investment horizon Korn Ferry is expected to generate 2.35 times less return on investment than Robert Half. But when comparing it to its historical volatility, Korn Ferry is 1.02 times less risky than Robert Half. It trades about 0.07 of its potential returns per unit of risk. Robert Half International is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  6,223  in Robert Half International on August 30, 2024 and sell it today you would earn a total of  1,247  from holding Robert Half International or generate 20.04% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.44%
Values	Daily Returns

Korn Ferry  vs.  Robert Half International

Korn Ferry

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Korn Ferry are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak technical and fundamental indicators, Korn Ferry may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Robert Half International

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Robert Half International are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak technical indicators, Robert Half demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Korn Ferry and Robert Half

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

The idea behind Korn Ferry and Robert Half International 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.

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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.