Correlation Between Kinnevik Investment and Seche Environnement
Can any of the company-specific risk be diversified away by investing in both Kinnevik Investment and Seche Environnement 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 Kinnevik Investment and Seche Environnement into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinnevik Investment AB and Seche Environnement SA, you can compare the effects of market volatilities on Kinnevik Investment and Seche Environnement 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 Kinnevik Investment with a short position of Seche Environnement. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinnevik Investment and Seche Environnement.
Diversification Opportunities for Kinnevik Investment and Seche Environnement
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kinnevik and Seche is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Kinnevik Investment AB and Seche Environnement SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seche Environnement and Kinnevik Investment 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 Kinnevik Investment AB are associated (or correlated) with Seche Environnement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seche Environnement has no effect on the direction of Kinnevik Investment i.e., Kinnevik Investment and Seche Environnement go up and down completely randomly.
Pair Corralation between Kinnevik Investment and Seche Environnement
Assuming the 90 days trading horizon Kinnevik Investment AB is expected to generate 0.89 times more return on investment than Seche Environnement. However, Kinnevik Investment AB is 1.13 times less risky than Seche Environnement. It trades about 0.31 of its potential returns per unit of risk. Seche Environnement SA is currently generating about 0.12 per unit of risk. If you would invest 7,655 in Kinnevik Investment AB on November 2, 2024 and sell it today you would earn a total of 1,188 from holding Kinnevik Investment AB or generate 15.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinnevik Investment AB vs. Seche Environnement SA
Performance |
| Timeline |
| Kinnevik Investment |
| Seche Environnement |
Kinnevik Investment and Seche Environnement Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinnevik Investment and Seche Environnement
The main advantage of trading using opposite Kinnevik Investment and Seche Environnement positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinnevik Investment position performs unexpectedly, Seche Environnement 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 Seche Environnement will offset losses from the drop in Seche Environnement's long position.| Kinnevik Investment vs. Morgan Advanced Materials | Kinnevik Investment vs. Atresmedia | Kinnevik Investment vs. Zinc Media Group | Kinnevik Investment vs. Pets at Home |
| Seche Environnement vs. Thor Mining PLC | Seche Environnement vs. Lundin Mining Corp | Seche Environnement vs. iShares Physical Silver | Seche Environnement vs. Hecla Mining Co |
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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