Correlation Between Rigetti Computing and Kimball Electronics

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

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

Diversification Opportunities for Rigetti Computing and Kimball Electronics

0.14

Correlation Coefficient

Rigetti Computing  Kimball Electronics

Average diversification

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

Pair Corralation between Rigetti Computing and Kimball Electronics

Given the investment horizon of 90 days Rigetti Computing is expected to generate 14.05 times more return on investment than Kimball Electronics. However, Rigetti Computing is 14.05 times more volatile than Kimball Electronics. It trades about 0.48 of its potential returns per unit of risk. Kimball Electronics is currently generating about -0.21 per unit of risk. If you would invest  174.00  in Rigetti Computing on September 23, 2024 and sell it today you would earn a total of  763.00  from holding Rigetti Computing or generate 438.51% return on investment over 90 days.

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

Rigetti Computing  vs.  Kimball Electronics

Rigetti Computing

Risk-Adjusted Performance

26 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Rigetti Computing are ranked lower than 26 (%) of all global equities and portfolios over the last 90 days. Despite fairly uncertain basic indicators, Rigetti Computing demonstrated solid returns over the last few months and may actually be approaching a breakup point.

Kimball Electronics

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Kimball Electronics are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound technical and fundamental indicators, Kimball Electronics is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Rigetti Computing and Kimball Electronics

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

The idea behind Rigetti Computing and Kimball Electronics 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.