Correlation Between Carnival Industrial and Kinko Optical
Can any of the company-specific risk be diversified away by investing in both Carnival Industrial and Kinko Optical 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 Carnival Industrial and Kinko Optical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Carnival Industrial Corp and Kinko Optical Co, you can compare the effects of market volatilities on Carnival Industrial and Kinko Optical 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 Carnival Industrial with a short position of Kinko Optical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carnival Industrial and Kinko Optical.
Diversification Opportunities for Carnival Industrial and Kinko Optical
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Carnival and Kinko is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Carnival Industrial Corp and Kinko Optical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinko Optical and Carnival Industrial 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 Carnival Industrial Corp are associated (or correlated) with Kinko Optical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinko Optical has no effect on the direction of Carnival Industrial i.e., Carnival Industrial and Kinko Optical go up and down completely randomly.
Pair Corralation between Carnival Industrial and Kinko Optical
Assuming the 90 days trading horizon Carnival Industrial Corp is expected to generate 0.48 times more return on investment than Kinko Optical. However, Carnival Industrial Corp is 2.09 times less risky than Kinko Optical. It trades about -0.05 of its potential returns per unit of risk. Kinko Optical Co is currently generating about -0.08 per unit of risk. If you would invest 1,000.00 in Carnival Industrial Corp on September 1, 2024 and sell it today you would lose (7.00) from holding Carnival Industrial Corp or give up 0.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Carnival Industrial Corp vs. Kinko Optical Co
Performance |
| Timeline |
| Carnival Industrial Corp |
| Kinko Optical |
Carnival Industrial and Kinko Optical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Carnival Industrial and Kinko Optical
The main advantage of trading using opposite Carnival Industrial and Kinko Optical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carnival Industrial position performs unexpectedly, Kinko Optical 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 Kinko Optical will offset losses from the drop in Kinko Optical's long position.| Carnival Industrial vs. Chaintech Technology Corp | Carnival Industrial vs. AVerMedia Technologies | Carnival Industrial vs. Avision | Carnival Industrial vs. Clevo 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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