Correlation Between EGain and Key Tronic
Can any of the company-specific risk be diversified away by investing in both EGain and Key Tronic 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 EGain and Key Tronic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between eGain and Key Tronic, you can compare the effects of market volatilities on EGain and Key Tronic 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 EGain with a short position of Key Tronic. Check out your portfolio center. Please also check ongoing floating volatility patterns of EGain and Key Tronic.
Diversification Opportunities for EGain and Key Tronic
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between EGain and Key is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding eGain and Key Tronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Key Tronic and EGain 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 eGain are associated (or correlated) with Key Tronic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Key Tronic has no effect on the direction of EGain i.e., EGain and Key Tronic go up and down completely randomly.
Pair Corralation between EGain and Key Tronic
Given the investment horizon of 90 days eGain is expected to generate 1.64 times more return on investment than Key Tronic. However, EGain is 1.64 times more volatile than Key Tronic. It trades about 0.15 of its potential returns per unit of risk. Key Tronic is currently generating about 0.1 per unit of risk. If you would invest 692.00 in eGain on July 8, 2025 and sell it today you would earn a total of 300.00 from holding eGain or generate 43.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
eGain vs. Key Tronic
Performance |
| Timeline |
| eGain |
| Key Tronic |
EGain and Key Tronic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EGain and Key Tronic
The main advantage of trading using opposite EGain and Key Tronic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EGain position performs unexpectedly, Key Tronic 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 Key Tronic will offset losses from the drop in Key Tronic's long position.The idea behind eGain and Key Tronic 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.| Key Tronic vs. AGM Group Holdings | Key Tronic vs. AstroNova | Key Tronic vs. Identiv | Key Tronic vs. Palladyne AI Corp |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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