Correlation Between KENNAMETAL INC and Comcast
Can any of the company-specific risk be diversified away by investing in both KENNAMETAL INC and Comcast 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 KENNAMETAL INC and Comcast into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KENNAMETAL INC and Comcast, you can compare the effects of market volatilities on KENNAMETAL INC and Comcast 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 KENNAMETAL INC with a short position of Comcast. Check out your portfolio center. Please also check ongoing floating volatility patterns of KENNAMETAL INC and Comcast.
Diversification Opportunities for KENNAMETAL INC and Comcast
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between KENNAMETAL and Comcast is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding KENNAMETAL INC and Comcast in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Comcast and KENNAMETAL INC 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 KENNAMETAL INC are associated (or correlated) with Comcast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Comcast has no effect on the direction of KENNAMETAL INC i.e., KENNAMETAL INC and Comcast go up and down completely randomly.
Pair Corralation between KENNAMETAL INC and Comcast
Assuming the 90 days trading horizon KENNAMETAL INC is expected to generate 1.37 times more return on investment than Comcast. However, KENNAMETAL INC is 1.37 times more volatile than Comcast. It trades about 0.22 of its potential returns per unit of risk. Comcast is currently generating about 0.0 per unit of risk. If you would invest 1,644 in KENNAMETAL INC on April 23, 2025 and sell it today you would earn a total of 456.00 from holding KENNAMETAL INC or generate 27.74% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
KENNAMETAL INC vs. Comcast
Performance |
Timeline |
KENNAMETAL INC |
Comcast |
KENNAMETAL INC and Comcast Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with KENNAMETAL INC and Comcast
The main advantage of trading using opposite KENNAMETAL INC and Comcast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KENNAMETAL INC position performs unexpectedly, Comcast 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 Comcast will offset losses from the drop in Comcast's long position.KENNAMETAL INC vs. WillScot Mobile Mini | KENNAMETAL INC vs. Granite Construction | KENNAMETAL INC vs. DAIRY FARM INTL | KENNAMETAL INC vs. Geely Automobile Holdings |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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