Correlation Between Knight Transportation and Golden Entertainment
Can any of the company-specific risk be diversified away by investing in both Knight Transportation and Golden Entertainment 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 Knight Transportation and Golden Entertainment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Knight Transportation and Golden Entertainment, you can compare the effects of market volatilities on Knight Transportation and Golden Entertainment 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 Knight Transportation with a short position of Golden Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Knight Transportation and Golden Entertainment.
Diversification Opportunities for Knight Transportation and Golden Entertainment
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Knight and Golden is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Knight Transportation and Golden Entertainment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Entertainment and Knight Transportation 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 Knight Transportation are associated (or correlated) with Golden Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Entertainment has no effect on the direction of Knight Transportation i.e., Knight Transportation and Golden Entertainment go up and down completely randomly.
Pair Corralation between Knight Transportation and Golden Entertainment
Considering the 90-day investment horizon Knight Transportation is expected to generate 0.57 times more return on investment than Golden Entertainment. However, Knight Transportation is 1.75 times less risky than Golden Entertainment. It trades about 0.12 of its potential returns per unit of risk. Golden Entertainment is currently generating about 0.07 per unit of risk. If you would invest 4,261 in Knight Transportation on September 6, 2025 and sell it today you would earn a total of 869.00 from holding Knight Transportation or generate 20.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Knight Transportation vs. Golden Entertainment
Performance |
| Timeline |
| Knight Transportation |
| Golden Entertainment |
Knight Transportation and Golden Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Knight Transportation and Golden Entertainment
The main advantage of trading using opposite Knight Transportation and Golden Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Knight Transportation position performs unexpectedly, Golden Entertainment 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 Golden Entertainment will offset losses from the drop in Golden Entertainment's long position.| Knight Transportation vs. Heritage Insurance Hldgs | Knight Transportation vs. Robinsons Retail Holdings | Knight Transportation vs. Plaza Retail REIT | Knight Transportation vs. Costco Wholesale Corp |
| Golden Entertainment vs. Sinclair Broadcast Group | Golden Entertainment vs. Perfect Medical Health | Golden Entertainment vs. Kestra Medical Technologies, | Golden Entertainment vs. Drugs Made In |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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