Correlation Between Amogreentech and KCC Engineering
Can any of the company-specific risk be diversified away by investing in both Amogreentech and KCC Engineering 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 Amogreentech and KCC Engineering into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amogreentech Co and KCC Engineering Construction, you can compare the effects of market volatilities on Amogreentech and KCC Engineering 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 Amogreentech with a short position of KCC Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amogreentech and KCC Engineering.
Diversification Opportunities for Amogreentech and KCC Engineering
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Amogreentech and KCC is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Amogreentech Co and KCC Engineering Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KCC Engineering Cons and Amogreentech 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 Amogreentech Co are associated (or correlated) with KCC Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KCC Engineering Cons has no effect on the direction of Amogreentech i.e., Amogreentech and KCC Engineering go up and down completely randomly.
Pair Corralation between Amogreentech and KCC Engineering
Assuming the 90 days trading horizon Amogreentech Co is expected to under-perform the KCC Engineering. In addition to that, Amogreentech is 2.81 times more volatile than KCC Engineering Construction. It trades about -0.07 of its total potential returns per unit of risk. KCC Engineering Construction is currently generating about -0.13 per unit of volatility. If you would invest 457,770 in KCC Engineering Construction on November 2, 2024 and sell it today you would lose (69,770) from holding KCC Engineering Construction or give up 15.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amogreentech Co vs. KCC Engineering Construction
Performance |
| Timeline |
| Amogreentech |
| KCC Engineering Cons |
Amogreentech and KCC Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amogreentech and KCC Engineering
The main advantage of trading using opposite Amogreentech and KCC Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amogreentech position performs unexpectedly, KCC Engineering 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 KCC Engineering will offset losses from the drop in KCC Engineering's long position.| Amogreentech vs. Alton Sports CoLtd | Amogreentech vs. Camus Engineering Construction | Amogreentech vs. Iljin Display | Amogreentech vs. KCC Engineering Construction |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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