Correlation Between Knightscope and Moving IMage

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

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

Diversification Opportunities for Knightscope and Moving IMage

0.78

Correlation Coefficient

Knightscope  Moving IMage

Poor diversification

The 3 months correlation between Knightscope and Moving is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Knightscope and Moving iMage Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Moving iMage Technologies and Knightscope 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 Knightscope are associated (or correlated) with Moving IMage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Moving iMage Technologies has no effect on the direction of Knightscope i.e., Knightscope and Moving IMage go up and down completely randomly.

Pair Corralation between Knightscope and Moving IMage

Given the investment horizon of 90 days Knightscope is expected to under-perform the Moving IMage. In addition to that, Knightscope is 1.01 times more volatile than Moving iMage Technologies. It trades about -0.33 of its total potential returns per unit of risk. Moving iMage Technologies is currently generating about -0.03 per unit of volatility. If you would invest  67.00  in Moving iMage Technologies on December 30, 2024 and sell it today you would lose (15.00) from holding Moving iMage Technologies or give up 22.39% of portfolio value over 90 days.

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

Knightscope  vs.  Moving iMage Technologies

Knightscope

Risk-Adjusted Performance

Very Weak

Over the last 90 days Knightscope has generated negative risk-adjusted returns adding no value to investors with long positions. Even with conflicting performance in the last few months, the Stock's fundamental indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Moving iMage Technologies

Risk-Adjusted Performance

Very Weak

Over the last 90 days Moving iMage Technologies has generated negative risk-adjusted returns adding no value to investors with long positions. Even with conflicting performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Knightscope and Moving IMage

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

The idea behind Knightscope and Moving iMage Technologies 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.