Correlation Between Mohawk Group and Kyocera ADR

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

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

Diversification Opportunities for Mohawk Group and Kyocera ADR

0.0

Correlation Coefficient

Mohawk Group  Kyocera ADR

Pay attention - limited upside

The 3 months correlation between Mohawk and Kyocera is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Mohawk Group Holdings and Kyocera ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kyocera ADR and Mohawk Group 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 Mohawk Group Holdings are associated (or correlated) with Kyocera ADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kyocera ADR has no effect on the direction of Mohawk Group i.e., Mohawk Group and Kyocera ADR go up and down completely randomly.

Pair Corralation between Mohawk Group and Kyocera ADR

If you would invest  4,914  in Kyocera ADR on January 19, 2024 and sell it today you would earn a total of  0.00  from holding Kyocera ADR or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Mohawk Group Holdings  vs.  Kyocera ADR

Mohawk Group Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mohawk Group Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Mohawk Group is not utilizing all of its potentials. The recent stock price mess, may contribute to short-term losses for the institutional investors.

Kyocera ADR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kyocera ADR has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong fundamental indicators, Kyocera ADR is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Mohawk Group and Kyocera ADR

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

The idea behind Mohawk Group Holdings and Kyocera ADR 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.