Correlation Between Kalray SA and Memscap Regpt
Can any of the company-specific risk be diversified away by investing in both Kalray SA and Memscap Regpt 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 Memscap Regpt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kalray SA and Memscap Regpt, you can compare the effects of market volatilities on Kalray SA and Memscap Regpt 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 Memscap Regpt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kalray SA and Memscap Regpt.
Diversification Opportunities for Kalray SA and Memscap Regpt
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Kalray and Memscap is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Kalray SA and Memscap Regpt in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Memscap Regpt 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 Memscap Regpt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Memscap Regpt has no effect on the direction of Kalray SA i.e., Kalray SA and Memscap Regpt go up and down completely randomly.
Pair Corralation between Kalray SA and Memscap Regpt
Assuming the 90 days trading horizon Kalray SA is expected to under-perform the Memscap Regpt. In addition to that, Kalray SA is 1.36 times more volatile than Memscap Regpt. It trades about -0.09 of its total potential returns per unit of risk. Memscap Regpt is currently generating about 0.06 per unit of volatility. If you would invest 172.00 in Memscap Regpt on August 27, 2024 and sell it today you would earn a total of 166.00 from holding Memscap Regpt or generate 96.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kalray SA vs. Memscap Regpt
Performance |
| Timeline |
| Kalray SA |
| Memscap Regpt |
Kalray SA and Memscap Regpt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kalray SA and Memscap Regpt
The main advantage of trading using opposite Kalray SA and Memscap Regpt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kalray SA position performs unexpectedly, Memscap Regpt 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 Memscap Regpt will offset losses from the drop in Memscap Regpt's long position.The idea behind Kalray SA and Memscap Regpt 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.| Memscap Regpt vs. Sartorius Stedim Biotech | Memscap Regpt vs. Lectra SA | Memscap Regpt vs. Teleperformance SE | Memscap Regpt vs. Trigano SA |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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