Correlation Between Kaonmedia and Xavis
Can any of the company-specific risk be diversified away by investing in both Kaonmedia and Xavis 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 Kaonmedia and Xavis into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kaonmedia Co and Xavis Co, you can compare the effects of market volatilities on Kaonmedia and Xavis 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 Kaonmedia with a short position of Xavis. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaonmedia and Xavis.
Diversification Opportunities for Kaonmedia and Xavis
Almost no diversification
The 3 months correlation between Kaonmedia and Xavis is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Kaonmedia Co and Xavis Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xavis and Kaonmedia 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 Kaonmedia Co are associated (or correlated) with Xavis. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xavis has no effect on the direction of Kaonmedia i.e., Kaonmedia and Xavis go up and down completely randomly.
Pair Corralation between Kaonmedia and Xavis
Assuming the 90 days trading horizon Kaonmedia Co is expected to generate 1.34 times more return on investment than Xavis. However, Kaonmedia is 1.34 times more volatile than Xavis Co. It trades about -0.04 of its potential returns per unit of risk. Xavis Co is currently generating about -0.47 per unit of risk. If you would invest 351,000 in Kaonmedia Co on September 1, 2024 and sell it today you would lose (14,000) from holding Kaonmedia Co or give up 3.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kaonmedia Co vs. Xavis Co
Performance |
| Timeline |
| Kaonmedia |
| Xavis |
Kaonmedia and Xavis Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kaonmedia and Xavis
The main advantage of trading using opposite Kaonmedia and Xavis positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaonmedia position performs unexpectedly, Xavis 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 Xavis will offset losses from the drop in Xavis' long position.| Kaonmedia vs. Dongsin Engineering Construction | Kaonmedia vs. Doosan Fuel Cell | Kaonmedia vs. Daishin Balance 1 | Kaonmedia vs. Total Soft Bank |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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