Correlation Between Khiron Life and Quaker Chemical
Can any of the company-specific risk be diversified away by investing in both Khiron Life and Quaker Chemical 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 Khiron Life and Quaker Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Khiron Life Sciences and Quaker Chemical, you can compare the effects of market volatilities on Khiron Life and Quaker Chemical 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 Khiron Life with a short position of Quaker Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Khiron Life and Quaker Chemical.
Diversification Opportunities for Khiron Life and Quaker Chemical
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Khiron and Quaker is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Khiron Life Sciences and Quaker Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Quaker Chemical and Khiron Life 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 Khiron Life Sciences are associated (or correlated) with Quaker Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Quaker Chemical has no effect on the direction of Khiron Life i.e., Khiron Life and Quaker Chemical go up and down completely randomly.
Pair Corralation between Khiron Life and Quaker Chemical
Assuming the 90 days trading horizon Khiron Life Sciences is expected to generate 2.08 times more return on investment than Quaker Chemical. However, Khiron Life is 2.08 times more volatile than Quaker Chemical. It trades about 0.01 of its potential returns per unit of risk. Quaker Chemical is currently generating about 0.01 per unit of risk. If you would invest 2.71 in Khiron Life Sciences on September 13, 2024 and sell it today you would lose (0.55) from holding Khiron Life Sciences or give up 20.3% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Khiron Life Sciences vs. Quaker Chemical
Performance |
| Timeline |
| Khiron Life Sciences |
| Quaker Chemical |
Khiron Life and Quaker Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Khiron Life and Quaker Chemical
The main advantage of trading using opposite Khiron Life and Quaker Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Khiron Life position performs unexpectedly, Quaker Chemical 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 Quaker Chemical will offset losses from the drop in Quaker Chemical's long position.| Khiron Life vs. Apple Inc | Khiron Life vs. Apple Inc | Khiron Life vs. Apple Inc | Khiron Life vs. Apple Inc |
| Quaker Chemical vs. ScanSource | Quaker Chemical vs. BlueScope Steel Limited | Quaker Chemical vs. KRAKATAU STEEL B | Quaker Chemical vs. Khiron Life Sciences |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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