Correlation Between Kadant and Landstar System

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

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

Diversification Opportunities for Kadant and Landstar System

0.31

Correlation Coefficient

Kadant  Landstar System

Weak diversification

The 3 months correlation between Kadant and Landstar is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Kadant Inc and Landstar System in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Landstar System and Kadant 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 Kadant Inc are associated (or correlated) with Landstar System. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Landstar System has no effect on the direction of Kadant i.e., Kadant and Landstar System go up and down completely randomly.

Pair Corralation between Kadant and Landstar System

Considering the 90-day investment horizon Kadant is expected to generate 15.24 times less return on investment than Landstar System. In addition to that, Kadant is 1.28 times more volatile than Landstar System. It trades about 0.01 of its total potential returns per unit of risk. Landstar System is currently generating about 0.12 per unit of volatility. If you would invest  13,053  in Landstar System on October 8, 2025 and sell it today you would earn a total of  1,625  from holding Landstar System or generate 12.45% return on investment over 90 days.

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

Kadant Inc  vs.  Landstar System

Kadant Inc

Risk-Adjusted Performance

Weakest

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

Landstar System

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Landstar System are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Landstar System reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kadant and Landstar System

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

The idea behind Kadant Inc and Landstar System 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..