Correlation Between Kaufman Broad and GAMING FAC
Can any of the company-specific risk be diversified away by investing in both Kaufman Broad and GAMING FAC 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 Kaufman Broad and GAMING FAC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kaufman Broad SA and GAMING FAC SA, you can compare the effects of market volatilities on Kaufman Broad and GAMING FAC 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 Kaufman Broad with a short position of GAMING FAC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaufman Broad and GAMING FAC.
Diversification Opportunities for Kaufman Broad and GAMING FAC
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Kaufman and GAMING is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Kaufman Broad SA and GAMING FAC SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GAMING FAC SA and Kaufman Broad 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 Kaufman Broad SA are associated (or correlated) with GAMING FAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GAMING FAC SA has no effect on the direction of Kaufman Broad i.e., Kaufman Broad and GAMING FAC go up and down completely randomly.
Pair Corralation between Kaufman Broad and GAMING FAC
Assuming the 90 days horizon Kaufman Broad SA is expected to under-perform the GAMING FAC. But the stock apears to be less risky and, when comparing its historical volatility, Kaufman Broad SA is 1.68 times less risky than GAMING FAC. The stock trades about -0.03 of its potential returns per unit of risk. The GAMING FAC SA is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 162.00 in GAMING FAC SA on September 22, 2024 and sell it today you would earn a total of 0.00 from holding GAMING FAC SA or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kaufman Broad SA vs. GAMING FAC SA
Performance |
| Timeline |
| Kaufman Broad SA |
| GAMING FAC SA |
Kaufman Broad and GAMING FAC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kaufman Broad and GAMING FAC
The main advantage of trading using opposite Kaufman Broad and GAMING FAC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaufman Broad position performs unexpectedly, GAMING FAC 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 GAMING FAC will offset losses from the drop in GAMING FAC's long position.| Kaufman Broad vs. PACIFIC ONLINE | Kaufman Broad vs. MCEWEN MINING INC | Kaufman Broad vs. CARSALESCOM | Kaufman Broad vs. LION ONE METALS |
| GAMING FAC vs. Kaufman Broad SA | GAMING FAC vs. Sanyo Chemical Industries | GAMING FAC vs. BROADWIND ENRGY | GAMING FAC vs. Soken Chemical Engineering |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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