Correlation Between Kerlink SAS and Claranova
Can any of the company-specific risk be diversified away by investing in both Kerlink SAS and Claranova 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 Kerlink SAS and Claranova into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kerlink SAS and Claranova SE, you can compare the effects of market volatilities on Kerlink SAS and Claranova 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 Kerlink SAS with a short position of Claranova. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kerlink SAS and Claranova.
Diversification Opportunities for Kerlink SAS and Claranova
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kerlink and Claranova is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Kerlink SAS and Claranova SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Claranova SE and Kerlink SAS 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 Kerlink SAS are associated (or correlated) with Claranova. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Claranova SE has no effect on the direction of Kerlink SAS i.e., Kerlink SAS and Claranova go up and down completely randomly.
Pair Corralation between Kerlink SAS and Claranova
Assuming the 90 days trading horizon Kerlink SAS is expected to generate 2.49 times more return on investment than Claranova. However, Kerlink SAS is 2.49 times more volatile than Claranova SE. It trades about 0.11 of its potential returns per unit of risk. Claranova SE is currently generating about 0.1 per unit of risk. If you would invest 50.00 in Kerlink SAS on September 2, 2024 and sell it today you would earn a total of 5.00 from holding Kerlink SAS or generate 10.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kerlink SAS vs. Claranova SE
Performance |
| Timeline |
| Kerlink SAS |
| Claranova SE |
Kerlink SAS and Claranova Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kerlink SAS and Claranova
The main advantage of trading using opposite Kerlink SAS and Claranova positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kerlink SAS position performs unexpectedly, Claranova 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 Claranova will offset losses from the drop in Claranova's long position.| Kerlink SAS vs. Claranova SE | Kerlink SAS vs. Balyo SA | Kerlink SAS vs. DBT SA | Kerlink SAS vs. Wallix Group SA |
| Claranova vs. Solutions 30 SE | Claranova vs. BigBen Interactive | Claranova vs. SA Catana Group | Claranova vs. Solocal Group 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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