Correlation Between Innovative Solutions and Kaman

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

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

Diversification Opportunities for Innovative Solutions and Kaman

0.0

Correlation Coefficient

Innovative Solutions  Kaman

Pay attention - limited upside

The 3 months correlation between Innovative and Kaman is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Innovative Solutions and and Kaman in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kaman and Innovative Solutions 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 Innovative Solutions and are associated (or correlated) with Kaman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kaman has no effect on the direction of Innovative Solutions i.e., Innovative Solutions and Kaman go up and down completely randomly.

Pair Corralation between Innovative Solutions and Kaman

If you would invest (100.00) in Kaman on December 30, 2024 and sell it today you would earn a total of  100.00  from holding Kaman or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Innovative Solutions and  vs.  Kaman

Innovative Solutions and

Risk-Adjusted Performance

Very Weak

Over the last 90 days Innovative Solutions and has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Kaman

Risk-Adjusted Performance

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.

Pair Trading with Innovative Solutions and Kaman

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

The idea behind Innovative Solutions and and Kaman 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.