Correlation Between Superior Plus and KINGBOARD CHEMICAL
Can any of the company-specific risk be diversified away by investing in both Superior Plus and KINGBOARD 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 Superior Plus and KINGBOARD CHEMICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Superior Plus Corp and KINGBOARD CHEMICAL, you can compare the effects of market volatilities on Superior Plus and KINGBOARD 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 Superior Plus with a short position of KINGBOARD CHEMICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Superior Plus and KINGBOARD CHEMICAL.
Diversification Opportunities for Superior Plus and KINGBOARD CHEMICAL
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Superior and KINGBOARD is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Superior Plus Corp and KINGBOARD CHEMICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KINGBOARD CHEMICAL and Superior Plus 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 Superior Plus Corp are associated (or correlated) with KINGBOARD CHEMICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KINGBOARD CHEMICAL has no effect on the direction of Superior Plus i.e., Superior Plus and KINGBOARD CHEMICAL go up and down completely randomly.
Pair Corralation between Superior Plus and KINGBOARD CHEMICAL
Assuming the 90 days horizon Superior Plus is expected to generate 5.27 times less return on investment than KINGBOARD CHEMICAL. But when comparing it to its historical volatility, Superior Plus Corp is 1.36 times less risky than KINGBOARD CHEMICAL. It trades about 0.03 of its potential returns per unit of risk. KINGBOARD CHEMICAL is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 236.00 in KINGBOARD CHEMICAL on December 11, 2024 and sell it today you would earn a total of 26.00 from holding KINGBOARD CHEMICAL or generate 11.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Superior Plus Corp vs. KINGBOARD CHEMICAL
Performance |
| Timeline |
| Superior Plus Corp |
| KINGBOARD CHEMICAL |
Superior Plus and KINGBOARD CHEMICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Superior Plus and KINGBOARD CHEMICAL
The main advantage of trading using opposite Superior Plus and KINGBOARD CHEMICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Superior Plus position performs unexpectedly, KINGBOARD 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 KINGBOARD CHEMICAL will offset losses from the drop in KINGBOARD CHEMICAL's long position.| Superior Plus vs. Stag Industrial | Superior Plus vs. GREENX METALS LTD | Superior Plus vs. Guangdong Investment Limited | Superior Plus vs. ADRIATIC METALS LS 013355 |
| KINGBOARD CHEMICAL vs. Gaztransport Technigaz SA | KINGBOARD CHEMICAL vs. Nok Airlines PCL | KINGBOARD CHEMICAL vs. SPORT LISBOA E | KINGBOARD CHEMICAL vs. China Eastern Airlines |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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