Correlation Between Kalray SA and Energisme
Can any of the company-specific risk be diversified away by investing in both Kalray SA and Energisme 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 Kalray SA and Energisme into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kalray SA and Energisme, you can compare the effects of market volatilities on Kalray SA and Energisme 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 Kalray SA with a short position of Energisme. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kalray SA and Energisme.
Diversification Opportunities for Kalray SA and Energisme
Very good diversification
The 3 months correlation between Kalray and Energisme is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Kalray SA and Energisme in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energisme and Kalray SA 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 Kalray SA are associated (or correlated) with Energisme. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energisme has no effect on the direction of Kalray SA i.e., Kalray SA and Energisme go up and down completely randomly.
Pair Corralation between Kalray SA and Energisme
Assuming the 90 days trading horizon Kalray SA is expected to generate 0.89 times more return on investment than Energisme. However, Kalray SA is 1.12 times less risky than Energisme. It trades about -0.04 of its potential returns per unit of risk. Energisme is currently generating about -0.06 per unit of risk. If you would invest 1,802 in Kalray SA on September 2, 2024 and sell it today you would lose (1,674) from holding Kalray SA or give up 92.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kalray SA vs. Energisme
Performance |
| Timeline |
| Kalray SA |
| Energisme |
Kalray SA and Energisme Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kalray SA and Energisme
The main advantage of trading using opposite Kalray SA and Energisme positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kalray SA position performs unexpectedly, Energisme 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 Energisme will offset losses from the drop in Energisme's long position.The idea behind Kalray SA and Energisme 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.| Energisme vs. Kerlink SAS | Energisme vs. Nacon Sa | Energisme vs. Agripower France Sa | Energisme vs. Hydrogen Refueling Solutions |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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