Correlation Between KNOT Offshore and Massimo Group

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

By analyzing existing cross correlation between KNOT Offshore Partners and Massimo Group Common, you can compare the effects of market volatilities on KNOT Offshore and Massimo Group 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 KNOT Offshore with a short position of Massimo Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of KNOT Offshore and Massimo Group.

Diversification Opportunities for KNOT Offshore and Massimo Group

0.5

Correlation Coefficient

KNOT Offshore  Massimo Group

Very weak diversification

The 3 months correlation between KNOT and Massimo is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding KNOT Offshore Partners and Massimo Group Common in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massimo Group Common and KNOT Offshore 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 KNOT Offshore Partners are associated (or correlated) with Massimo Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Massimo Group Common has no effect on the direction of KNOT Offshore i.e., KNOT Offshore and Massimo Group go up and down completely randomly.

Pair Corralation between KNOT Offshore and Massimo Group

Given the investment horizon of 90 days KNOT Offshore Partners is expected to generate 0.31 times more return on investment than Massimo Group. However, KNOT Offshore Partners is 3.26 times less risky than Massimo Group. It trades about -0.05 of its potential returns per unit of risk. Massimo Group Common is currently generating about -0.02 per unit of risk. If you would invest  632.00  in KNOT Offshore Partners on October 25, 2024 and sell it today you would lose (48.00) from holding KNOT Offshore Partners or give up 7.59% of portfolio value over 90 days.

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

KNOT Offshore Partners  vs.  Massimo Group Common

KNOT Offshore Partners

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KNOT Offshore Partners has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unsteady performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Massimo Group Common

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Massimo Group Common has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unfluctuating performance, the Stock's primary indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the firm investors.

Pair Trading with KNOT Offshore and Massimo Group

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

The idea behind KNOT Offshore Partners and Massimo Group Common 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.