Correlation Between Kuehne + and Forward Air

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

By analyzing existing cross correlation between Kuehne Nagel International and Forward Air, you can compare the effects of market volatilities on Kuehne + and Forward Air 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 Kuehne + with a short position of Forward Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kuehne + and Forward Air.

Diversification Opportunities for Kuehne + and Forward Air

-0.42

Correlation Coefficient

Kuehne +  Forward Air

Very good diversification

The 3 months correlation between Kuehne and Forward is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Kuehne Nagel International and Forward Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Forward Air and Kuehne + 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 Kuehne Nagel International are associated (or correlated) with Forward Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Forward Air has no effect on the direction of Kuehne + i.e., Kuehne + and Forward Air go up and down completely randomly.

Pair Corralation between Kuehne + and Forward Air

Assuming the 90 days horizon Kuehne Nagel International is expected to under-perform the Forward Air. But the pink sheet apears to be less risky and, when comparing its historical volatility, Kuehne Nagel International is 2.69 times less risky than Forward Air. The pink sheet trades about -0.36 of its potential returns per unit of risk. The Forward Air is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  3,224  in Forward Air on September 3, 2024 and sell it today you would earn a total of  445.00  from holding Forward Air or generate 13.8% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Kuehne Nagel International  vs.  Forward Air

Kuehne Nagel Interna

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kuehne Nagel International has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Forward Air

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Forward Air are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, Forward Air exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kuehne + and Forward Air

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

The idea behind Kuehne Nagel International and Forward Air 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.