Correlation Between Aldel Financial and Kingdee International
Can any of the company-specific risk be diversified away by investing in both Aldel Financial and Kingdee International 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 Aldel Financial and Kingdee International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aldel Financial II and Kingdee International Software, you can compare the effects of market volatilities on Aldel Financial and Kingdee International 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 Aldel Financial with a short position of Kingdee International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aldel Financial and Kingdee International.
Diversification Opportunities for Aldel Financial and Kingdee International
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aldel and Kingdee is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Aldel Financial II and Kingdee International Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kingdee International and Aldel Financial 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 Aldel Financial II are associated (or correlated) with Kingdee International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kingdee International has no effect on the direction of Aldel Financial i.e., Aldel Financial and Kingdee International go up and down completely randomly.
Pair Corralation between Aldel Financial and Kingdee International
Given the investment horizon of 90 days Aldel Financial II is expected to generate 0.03 times more return on investment than Kingdee International. However, Aldel Financial II is 30.65 times less risky than Kingdee International. It trades about 0.31 of its potential returns per unit of risk. Kingdee International Software is currently generating about -0.03 per unit of risk. If you would invest 990.00 in Aldel Financial II on November 1, 2024 and sell it today you would earn a total of 10.00 from holding Aldel Financial II or generate 1.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 6.04% |
| Values | Daily Returns |
Aldel Financial II vs. Kingdee International Software
Performance |
| Timeline |
| Aldel Financial II |
| Kingdee International |
Aldel Financial and Kingdee International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aldel Financial and Kingdee International
The main advantage of trading using opposite Aldel Financial and Kingdee International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aldel Financial position performs unexpectedly, Kingdee International 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 Kingdee International will offset losses from the drop in Kingdee International's long position.| Aldel Financial vs. Alaska Air Group | Aldel Financial vs. Alto Neuroscience, | Aldel Financial vs. Paysafe | Aldel Financial vs. Cirmaker Technology |
| Kingdee International vs. Inflection Point Acquisition | Kingdee International vs. WK Kellogg Co | Kingdee International vs. Ingredion Incorporated | Kingdee International vs. Aldel Financial II |
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.
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