Correlation Between Ming Le and Korn Ferry

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

By analyzing existing cross correlation between Ming Le Sports and Korn Ferry, you can compare the effects of market volatilities on Ming Le and Korn Ferry 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 Ming Le with a short position of Korn Ferry. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ming Le and Korn Ferry.

Diversification Opportunities for Ming Le and Korn Ferry

0.76

Correlation Coefficient

Ming Le  Korn Ferry

Poor diversification

The 3 months correlation between Ming and Korn is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Ming Le Sports and Korn Ferry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korn Ferry and Ming Le 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 Ming Le Sports are associated (or correlated) with Korn Ferry. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korn Ferry has no effect on the direction of Ming Le i.e., Ming Le and Korn Ferry go up and down completely randomly.

Pair Corralation between Ming Le and Korn Ferry

Assuming the 90 days horizon Ming Le Sports is expected to under-perform the Korn Ferry. But the stock apears to be less risky and, when comparing its historical volatility, Ming Le Sports is 1.15 times less risky than Korn Ferry. The stock trades about -0.23 of its potential returns per unit of risk. The Korn Ferry is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest  7,159  in Korn Ferry on December 5, 2024 and sell it today you would lose (859.00) from holding Korn Ferry or give up 12.0% of portfolio value over 90 days.

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

Ming Le Sports  vs.  Korn Ferry

Ming Le Sports

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ming Le Sports has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic 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.

Korn Ferry

Risk-Adjusted Performance

Very Weak

Over the last 90 days Korn Ferry has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Pair Trading with Ming Le and Korn Ferry

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

The idea behind Ming Le Sports and Korn Ferry 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.