Correlation Between Kontoor Brands and Camrova Resources

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

By analyzing existing cross correlation between Kontoor Brands and Camrova Resources, you can compare the effects of market volatilities on Kontoor Brands and Camrova Resources 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 Kontoor Brands with a short position of Camrova Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kontoor Brands and Camrova Resources.

Diversification Opportunities for Kontoor Brands and Camrova Resources

0.39

Correlation Coefficient

Kontoor Brands  Camrova Resources

Weak diversification

The 3 months correlation between Kontoor and Camrova is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Kontoor Brands and Camrova Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Camrova Resources and Kontoor Brands 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 Kontoor Brands are associated (or correlated) with Camrova Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Camrova Resources has no effect on the direction of Kontoor Brands i.e., Kontoor Brands and Camrova Resources go up and down completely randomly.

Pair Corralation between Kontoor Brands and Camrova Resources

If you would invest  0.00  in Camrova Resources on December 2, 2024 and sell it today you would earn a total of  0.00  from holding Camrova Resources or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Kontoor Brands  vs.  Camrova Resources

Kontoor Brands

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kontoor Brands has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Camrova Resources

Risk-Adjusted Performance

Very Weak

Over the last 90 days Camrova Resources has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unsteady performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Kontoor Brands and Camrova Resources

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

The idea behind Kontoor Brands and Camrova Resources 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.