Correlation Between Kinko Optical and Cleanaway
Can any of the company-specific risk be diversified away by investing in both Kinko Optical and Cleanaway 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 Cleanaway 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 Cleanaway Co, you can compare the effects of market volatilities on Kinko Optical and Cleanaway 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 Cleanaway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinko Optical and Cleanaway.
Diversification Opportunities for Kinko Optical and Cleanaway
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kinko and Cleanaway is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Kinko Optical Co and Cleanaway Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cleanaway 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 Cleanaway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cleanaway has no effect on the direction of Kinko Optical i.e., Kinko Optical and Cleanaway go up and down completely randomly.
Pair Corralation between Kinko Optical and Cleanaway
Assuming the 90 days trading horizon Kinko Optical is expected to generate 1.5 times less return on investment than Cleanaway. In addition to that, Kinko Optical is 2.35 times more volatile than Cleanaway Co. It trades about 0.0 of its total potential returns per unit of risk. Cleanaway Co is currently generating about 0.01 per unit of volatility. If you would invest 17,800 in Cleanaway Co on August 29, 2024 and sell it today you would earn a total of 300.00 from holding Cleanaway Co or generate 1.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Kinko Optical Co vs. Cleanaway Co
Performance |
| Timeline |
| Kinko Optical |
| Cleanaway |
Kinko Optical and Cleanaway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinko Optical and Cleanaway
The main advantage of trading using opposite Kinko Optical and Cleanaway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinko Optical position performs unexpectedly, Cleanaway 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 Cleanaway will offset losses from the drop in Cleanaway's long position.| Kinko Optical vs. Asia Optical Co | Kinko Optical vs. Genius Electronic Optical | Kinko Optical vs. Altek Corp | Kinko Optical vs. Hannstar Display Corp |
| Cleanaway vs. Yulon Motor Co | Cleanaway vs. Far Eastern Department | Cleanaway vs. China Steel Corp | Cleanaway vs. Chang Hwa Commercial |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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