Correlation Between KLA Tencor and Intuit

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

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

Diversification Opportunities for KLA Tencor and Intuit

0.81

Correlation Coefficient

KLA Tencor  Intuit

Very poor diversification

The 3 months correlation between KLA and Intuit is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding KLA Tencor and Intuit Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intuit Inc and KLA Tencor 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 KLA Tencor are associated (or correlated) with Intuit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intuit Inc has no effect on the direction of KLA Tencor i.e., KLA Tencor and Intuit go up and down completely randomly.

Pair Corralation between KLA Tencor and Intuit

Given the investment horizon of 90 days KLA Tencor is expected to generate 1.34 times more return on investment than Intuit. However, KLA Tencor is 1.34 times more volatile than Intuit Inc. It trades about 0.2 of its potential returns per unit of risk. Intuit Inc is currently generating about 0.22 per unit of risk. If you would invest  69,163  in KLA Tencor on May 4, 2025 and sell it today you would earn a total of  19,501  from holding KLA Tencor or generate 28.2% return on investment over 90 days.

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

KLA Tencor  vs.  Intuit Inc

KLA Tencor

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in KLA Tencor are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather conflicting basic indicators, KLA Tencor exhibited solid returns over the last few months and may actually be approaching a breakup point.

Intuit Inc

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Intuit Inc are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively conflicting basic indicators, Intuit unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with KLA Tencor and Intuit

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

The idea behind KLA Tencor and Intuit Inc 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 Stocks Directory module to find actively traded stocks across global markets.