Correlation Between Kaufman Et and Gaztransport
Can any of the company-specific risk be diversified away by investing in both Kaufman Et and Gaztransport 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 Kaufman Et and Gaztransport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kaufman Et Broad and Gaztransport et Technigaz, you can compare the effects of market volatilities on Kaufman Et and Gaztransport 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 Kaufman Et with a short position of Gaztransport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaufman Et and Gaztransport.
Diversification Opportunities for Kaufman Et and Gaztransport
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between Kaufman and Gaztransport is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding Kaufman Et Broad and Gaztransport et Technigaz in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gaztransport et Technigaz and Kaufman Et 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 Kaufman Et Broad are associated (or correlated) with Gaztransport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gaztransport et Technigaz has no effect on the direction of Kaufman Et i.e., Kaufman Et and Gaztransport go up and down completely randomly.
Pair Corralation between Kaufman Et and Gaztransport
Assuming the 90 days trading horizon Kaufman Et Broad is expected to under-perform the Gaztransport. In addition to that, Kaufman Et is 1.19 times more volatile than Gaztransport et Technigaz. It trades about -0.33 of its total potential returns per unit of risk. Gaztransport et Technigaz is currently generating about 0.06 per unit of volatility. If you would invest 13,656 in Gaztransport et Technigaz on August 29, 2024 and sell it today you would earn a total of 209.00 from holding Gaztransport et Technigaz or generate 1.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kaufman Et Broad vs. Gaztransport et Technigaz
Performance |
| Timeline |
| Kaufman Et Broad |
| Gaztransport et Technigaz |
Kaufman Et and Gaztransport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kaufman Et and Gaztransport
The main advantage of trading using opposite Kaufman Et and Gaztransport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaufman Et position performs unexpectedly, Gaztransport 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 Gaztransport will offset losses from the drop in Gaztransport's long position.| Kaufman Et vs. Lendinvest PLC | Kaufman Et vs. Neometals | Kaufman Et vs. Albion Technology General | Kaufman Et vs. Jupiter Fund Management |
| Gaztransport vs. Lendinvest PLC | Gaztransport vs. Neometals | Gaztransport vs. Albion Technology General | Gaztransport vs. Jupiter Fund Management |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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