Correlation Between Kinnevik Investment and Ecclesiastical Insurance
Can any of the company-specific risk be diversified away by investing in both Kinnevik Investment and Ecclesiastical Insurance 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 Ecclesiastical Insurance 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 Ecclesiastical Insurance Office, you can compare the effects of market volatilities on Kinnevik Investment and Ecclesiastical Insurance 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 Ecclesiastical Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinnevik Investment and Ecclesiastical Insurance.
Diversification Opportunities for Kinnevik Investment and Ecclesiastical Insurance
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kinnevik and Ecclesiastical is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Kinnevik Investment AB and Ecclesiastical Insurance Offic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ecclesiastical Insurance 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 Ecclesiastical Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ecclesiastical Insurance has no effect on the direction of Kinnevik Investment i.e., Kinnevik Investment and Ecclesiastical Insurance go up and down completely randomly.
Pair Corralation between Kinnevik Investment and Ecclesiastical Insurance
Assuming the 90 days trading horizon Kinnevik Investment AB is expected to generate 1.99 times more return on investment than Ecclesiastical Insurance. However, Kinnevik Investment is 1.99 times more volatile than Ecclesiastical Insurance Office. It trades about 0.09 of its potential returns per unit of risk. Ecclesiastical Insurance Office is currently generating about 0.04 per unit of risk. If you would invest 7,576 in Kinnevik Investment AB on October 26, 2024 and sell it today you would earn a total of 433.00 from holding Kinnevik Investment AB or generate 5.72% 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. Ecclesiastical Insurance Offic
Performance |
| Timeline |
| Kinnevik Investment |
| Ecclesiastical Insurance |
Kinnevik Investment and Ecclesiastical Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinnevik Investment and Ecclesiastical Insurance
The main advantage of trading using opposite Kinnevik Investment and Ecclesiastical Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinnevik Investment position performs unexpectedly, Ecclesiastical Insurance 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 Ecclesiastical Insurance will offset losses from the drop in Ecclesiastical Insurance's long position.| Kinnevik Investment vs. Berkshire Hathaway | Kinnevik Investment vs. Samsung Electronics Co | Kinnevik Investment vs. Samsung Electronics Co | Kinnevik Investment vs. Chocoladefabriken Lindt Spruengli |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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