Correlation Between AcadeMedia and Kinnevik Investment
Can any of the company-specific risk be diversified away by investing in both AcadeMedia and Kinnevik Investment 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 AcadeMedia and Kinnevik Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AcadeMedia AB and Kinnevik Investment AB, you can compare the effects of market volatilities on AcadeMedia and Kinnevik Investment 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 AcadeMedia with a short position of Kinnevik Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of AcadeMedia and Kinnevik Investment.
Diversification Opportunities for AcadeMedia and Kinnevik Investment
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between AcadeMedia and Kinnevik is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding AcadeMedia AB and Kinnevik Investment AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinnevik Investment and AcadeMedia 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 AcadeMedia AB are associated (or correlated) with Kinnevik Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinnevik Investment has no effect on the direction of AcadeMedia i.e., AcadeMedia and Kinnevik Investment go up and down completely randomly.
Pair Corralation between AcadeMedia and Kinnevik Investment
Assuming the 90 days trading horizon AcadeMedia AB is expected to generate 0.67 times more return on investment than Kinnevik Investment. However, AcadeMedia AB is 1.49 times less risky than Kinnevik Investment. It trades about 0.06 of its potential returns per unit of risk. Kinnevik Investment AB is currently generating about -0.05 per unit of risk. If you would invest 4,147 in AcadeMedia AB on September 2, 2024 and sell it today you would earn a total of 1,853 from holding AcadeMedia AB or generate 44.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.81% |
| Values | Daily Returns |
AcadeMedia AB vs. Kinnevik Investment AB
Performance |
| Timeline |
| AcadeMedia AB |
| Kinnevik Investment |
AcadeMedia and Kinnevik Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AcadeMedia and Kinnevik Investment
The main advantage of trading using opposite AcadeMedia and Kinnevik Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AcadeMedia position performs unexpectedly, Kinnevik Investment 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 Kinnevik Investment will offset losses from the drop in Kinnevik Investment's long position.| AcadeMedia vs. Molson Coors Beverage | AcadeMedia vs. Charter Communications Cl | AcadeMedia vs. Team Internet Group | AcadeMedia vs. bet at home AG |
| Kinnevik Investment vs. Intermediate Capital Group | Kinnevik Investment vs. AcadeMedia AB | Kinnevik Investment vs. International Biotechnology Trust | Kinnevik Investment vs. Flutter Entertainment PLC |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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