Correlation Between MillerKnoll and Whirlpool

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

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

Diversification Opportunities for MillerKnoll and Whirlpool

0.14

Correlation Coefficient

MillerKnoll  Whirlpool

Average diversification

The 3 months correlation between MillerKnoll and Whirlpool is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding MillerKnoll and Whirlpool in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Whirlpool and MillerKnoll 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 MillerKnoll are associated (or correlated) with Whirlpool. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Whirlpool has no effect on the direction of MillerKnoll i.e., MillerKnoll and Whirlpool go up and down completely randomly.

Pair Corralation between MillerKnoll and Whirlpool

Given the investment horizon of 90 days MillerKnoll is expected to under-perform the Whirlpool. In addition to that, MillerKnoll is 1.03 times more volatile than Whirlpool. It trades about -0.06 of its total potential returns per unit of risk. Whirlpool is currently generating about -0.02 per unit of volatility. If you would invest  10,322  in Whirlpool on December 2, 2024 and sell it today you would lose (143.00) from holding Whirlpool or give up 1.39% of portfolio value over 90 days.

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

MillerKnoll  vs.  Whirlpool

MillerKnoll

Risk-Adjusted Performance

Very Weak

Over the last 90 days MillerKnoll has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's forward-looking signals remain very healthy which may send shares a bit higher in April 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Whirlpool

Risk-Adjusted Performance

Very Weak

Over the last 90 days Whirlpool has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable technical indicators, Whirlpool is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with MillerKnoll and Whirlpool

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

The idea behind MillerKnoll and Whirlpool 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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.