Correlation Between United Parcel and KFT
Can any of the company-specific risk be diversified away by investing in both United Parcel and KFT 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 United Parcel and KFT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Parcel Service and KFT, you can compare the effects of market volatilities on United Parcel and KFT 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 United Parcel with a short position of KFT. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Parcel and KFT.
Diversification Opportunities for United Parcel and KFT
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between United and KFT is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding United Parcel Service and KFT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KFT and United Parcel 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 United Parcel Service are associated (or correlated) with KFT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KFT has no effect on the direction of United Parcel i.e., United Parcel and KFT go up and down completely randomly.
Pair Corralation between United Parcel and KFT
If you would invest (100.00) in KFT on January 19, 2024 and sell it today you would earn a total of 100.00 from holding KFT or generate -100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
United Parcel Service vs. KFT
Performance |
| Timeline |
| United Parcel Service |
| KFT |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
United Parcel and KFT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Parcel and KFT
The main advantage of trading using opposite United Parcel and KFT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Parcel position performs unexpectedly, KFT 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 KFT will offset losses from the drop in KFT's long position.| United Parcel vs. GXO Logistics | United Parcel vs. JB Hunt Transport | United Parcel vs. Expeditors International of | United Parcel vs. CH Robinson Worldwide |
Check out your portfolio center.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 Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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