Correlation Between Pinterest and KLA Tencor

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

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

Diversification Opportunities for Pinterest and KLA Tencor

0.93

Correlation Coefficient

Pinterest  KLA Tencor

Almost no diversification

The 3 months correlation between Pinterest and KLA is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Pinterest and KLA Tencor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KLA Tencor and Pinterest 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 Pinterest are associated (or correlated) with KLA Tencor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KLA Tencor has no effect on the direction of Pinterest i.e., Pinterest and KLA Tencor go up and down completely randomly.

Pair Corralation between Pinterest and KLA Tencor

Given the investment horizon of 90 days Pinterest is expected to generate 1.09 times more return on investment than KLA Tencor. However, Pinterest is 1.09 times more volatile than KLA Tencor. It trades about 0.25 of its potential returns per unit of risk. KLA Tencor is currently generating about 0.22 per unit of risk. If you would invest  2,699  in Pinterest on May 6, 2025 and sell it today you would earn a total of  1,077  from holding Pinterest or generate 39.9% return on investment over 90 days.

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

Pinterest  vs.  KLA Tencor

Pinterest

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Pinterest are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Pinterest unveiled solid returns over the last few months and may actually be approaching a breakup point.

KLA Tencor

Risk-Adjusted Performance

Solid

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

Pair Trading with Pinterest and KLA Tencor

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

The idea behind Pinterest and KLA Tencor 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.

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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.