Correlation Between Korn Ferry and TrueBlue

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

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

Diversification Opportunities for Korn Ferry and TrueBlue

0.56

Correlation Coefficient

Korn Ferry  TrueBlue

Very weak diversification

The 3 months correlation between Korn and TrueBlue is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Korn Ferry and TrueBlue in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TrueBlue 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 TrueBlue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TrueBlue has no effect on the direction of Korn Ferry i.e., Korn Ferry and TrueBlue go up and down completely randomly.

Pair Corralation between Korn Ferry and TrueBlue

Considering the 90-day investment horizon Korn Ferry is expected to generate 0.4 times more return on investment than TrueBlue. However, Korn Ferry is 2.48 times less risky than TrueBlue. It trades about 0.02 of its potential returns per unit of risk. TrueBlue is currently generating about -0.11 per unit of risk. If you would invest  6,701  in Korn Ferry on December 28, 2024 and sell it today you would earn a total of  75.00  from holding Korn Ferry or generate 1.12% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.36%
Values	Daily Returns

Korn Ferry  vs.  TrueBlue

Korn Ferry

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Korn Ferry are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong technical and fundamental indicators, Korn Ferry is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

TrueBlue

Risk-Adjusted Performance

Very Weak

Over the last 90 days TrueBlue has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's fundamental drivers remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the firm traders.

Pair Trading with Korn Ferry and TrueBlue

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

The idea behind Korn Ferry and TrueBlue 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.