Correlation Between PTSI Old and Knight Transportation

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

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

Diversification Opportunities for PTSI Old and Knight Transportation

0.0

Correlation Coefficient

PTSI Old  Knight Transportation

Pay attention - limited upside

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

Pair Corralation between PTSI Old and Knight Transportation

If you would invest (100.00) in PTSI Old on January 11, 2025 and sell it today you would earn a total of  100.00  from holding PTSI Old 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

PTSI Old  vs.  Knight Transportation

PTSI Old

Risk-Adjusted Performance

Very Weak

Over the last 90 days PTSI Old has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, PTSI Old is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Knight Transportation

Risk-Adjusted Performance

Very Weak

Over the last 90 days Knight Transportation has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in May 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with PTSI Old and Knight Transportation

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

The idea behind PTSI Old and Knight Transportation 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.