Correlation Between Kinko Optical and Zinwell
Can any of the company-specific risk be diversified away by investing in both Kinko Optical and Zinwell 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 Kinko Optical and Zinwell into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinko Optical Co and Zinwell, you can compare the effects of market volatilities on Kinko Optical and Zinwell 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 Kinko Optical with a short position of Zinwell. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinko Optical and Zinwell.
Diversification Opportunities for Kinko Optical and Zinwell
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kinko and Zinwell is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Kinko Optical Co and Zinwell in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zinwell and Kinko Optical 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 Kinko Optical Co are associated (or correlated) with Zinwell. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zinwell has no effect on the direction of Kinko Optical i.e., Kinko Optical and Zinwell go up and down completely randomly.
Pair Corralation between Kinko Optical and Zinwell
Assuming the 90 days trading horizon Kinko Optical Co is expected to generate 1.55 times more return on investment than Zinwell. However, Kinko Optical is 1.55 times more volatile than Zinwell. It trades about 0.05 of its potential returns per unit of risk. Zinwell is currently generating about -0.16 per unit of risk. If you would invest 2,495 in Kinko Optical Co on November 6, 2024 and sell it today you would earn a total of 170.00 from holding Kinko Optical Co or generate 6.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinko Optical Co vs. Zinwell
Performance |
| Timeline |
| Kinko Optical |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
| Zinwell |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Kinko Optical and Zinwell Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinko Optical and Zinwell
The main advantage of trading using opposite Kinko Optical and Zinwell positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinko Optical position performs unexpectedly, Zinwell 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 Zinwell will offset losses from the drop in Zinwell's long position.The idea behind Kinko Optical Co and Zinwell pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
Other Complementary Tools
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |