Correlation Between Kuehne + and CH Robinson

Can any of the company-specific risk be diversified away by investing in both Kuehne + and CH Robinson 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 CH Robinson 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 CH Robinson Worldwide, you can compare the effects of market volatilities on Kuehne + and CH Robinson 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 CH Robinson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kuehne + and CH Robinson.

Diversification Opportunities for Kuehne + and CH Robinson

0.22

Correlation Coefficient

Kuehne +  CH Robinson

Modest diversification

The 3 months correlation between Kuehne and CHRW is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Kuehne Nagel International and CH Robinson Worldwide in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CH Robinson Worldwide 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 CH Robinson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CH Robinson Worldwide has no effect on the direction of Kuehne + i.e., Kuehne + and CH Robinson go up and down completely randomly.

Pair Corralation between Kuehne + and CH Robinson

Assuming the 90 days horizon Kuehne Nagel International is expected to generate 1.85 times more return on investment than CH Robinson. However, Kuehne + is 1.85 times more volatile than CH Robinson Worldwide. It trades about 0.01 of its potential returns per unit of risk. CH Robinson Worldwide is currently generating about 0.03 per unit of risk. If you would invest  23,250  in Kuehne Nagel International on October 4, 2024 and sell it today you would lose (547.00) from holding Kuehne Nagel International or give up 2.35% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	79.8%
Values	Daily Returns

Kuehne Nagel International  vs.  CH Robinson Worldwide

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 weak performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

CH Robinson Worldwide

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CH Robinson Worldwide has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, CH Robinson is not utilizing all of its potentials. The newest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Kuehne + and CH Robinson

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

The idea behind Kuehne Nagel International and CH Robinson Worldwide 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.