Correlation Between Kontrol Technologies and Computer Task

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

By analyzing existing cross correlation between Kontrol Technologies Corp and Computer Task Group, you can compare the effects of market volatilities on Kontrol Technologies and Computer Task 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 Kontrol Technologies with a short position of Computer Task. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kontrol Technologies and Computer Task.

Diversification Opportunities for Kontrol Technologies and Computer Task

-0.77

Correlation Coefficient

Kontrol Technologies  Computer Task

Pay attention - limited upside

The 3 months correlation between Kontrol and Computer is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Kontrol Technologies Corp and Computer Task Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Computer Task Group and Kontrol Technologies 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 Kontrol Technologies Corp are associated (or correlated) with Computer Task. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Computer Task Group has no effect on the direction of Kontrol Technologies i.e., Kontrol Technologies and Computer Task go up and down completely randomly.

Pair Corralation between Kontrol Technologies and Computer Task

If you would invest  13.00  in Kontrol Technologies Corp on October 20, 2024 and sell it today you would lose (2.00) from holding Kontrol Technologies Corp or give up 15.38% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	1.61%
Values	Daily Returns

Kontrol Technologies Corp  vs.  Computer Task Group

Kontrol Technologies Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kontrol Technologies Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, Kontrol Technologies is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Computer Task Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Computer Task Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Computer Task is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Kontrol Technologies and Computer Task

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

The idea behind Kontrol Technologies Corp and Computer Task Group 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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.