Correlation Between AD Plastik and KRA Dd
Can any of the company-specific risk be diversified away by investing in both AD Plastik and KRA Dd 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 AD Plastik and KRA Dd into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AD Plastik dd and KRA dd, you can compare the effects of market volatilities on AD Plastik and KRA Dd 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 AD Plastik with a short position of KRA Dd. Check out your portfolio center. Please also check ongoing floating volatility patterns of AD Plastik and KRA Dd.
Diversification Opportunities for AD Plastik and KRA Dd
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ADPL and KRA is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding AD Plastik dd and KRA dd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KRA dd and AD Plastik 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 AD Plastik dd are associated (or correlated) with KRA Dd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KRA dd has no effect on the direction of AD Plastik i.e., AD Plastik and KRA Dd go up and down completely randomly.
Pair Corralation between AD Plastik and KRA Dd
Assuming the 90 days trading horizon AD Plastik dd is expected to generate 0.75 times more return on investment than KRA Dd. However, AD Plastik dd is 1.33 times less risky than KRA Dd. It trades about -0.08 of its potential returns per unit of risk. KRA dd is currently generating about -0.29 per unit of risk. If you would invest 950.00 in AD Plastik dd on October 20, 2024 and sell it today you would lose (30.00) from holding AD Plastik dd or give up 3.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 37.5% |
| Values | Daily Returns |
AD Plastik dd vs. KRA dd
Performance |
| Timeline |
| AD Plastik dd |
| KRA dd |
AD Plastik and KRA Dd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AD Plastik and KRA Dd
The main advantage of trading using opposite AD Plastik and KRA Dd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AD Plastik position performs unexpectedly, KRA Dd 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 KRA Dd will offset losses from the drop in KRA Dd's long position.| AD Plastik vs. Dalekovod dd | AD Plastik vs. Institut IGH dd | AD Plastik vs. Jadroplov dd | AD Plastik vs. Zagrebacka Banka dd |
| KRA Dd vs. AD Plastik dd | KRA Dd vs. Hrvatska Postanska Banka | KRA Dd vs. Dalekovod dd | KRA Dd vs. Podravka Prehrambena Industrija |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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