Correlation Between Boswell J and KS AG
Can any of the company-specific risk be diversified away by investing in both Boswell J and KS AG 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 Boswell J and KS AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Boswell J G and KS AG DRC, you can compare the effects of market volatilities on Boswell J and KS AG 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 Boswell J with a short position of KS AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boswell J and KS AG.
Diversification Opportunities for Boswell J and KS AG
Significant diversification
The 3 months correlation between Boswell and KPLUY is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Boswell J G and KS AG DRC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KS AG DRC and Boswell J 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 Boswell J G are associated (or correlated) with KS AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KS AG DRC has no effect on the direction of Boswell J i.e., Boswell J and KS AG go up and down completely randomly.
Pair Corralation between Boswell J and KS AG
Given the investment horizon of 90 days Boswell J G is expected to generate 0.43 times more return on investment than KS AG. However, Boswell J G is 2.34 times less risky than KS AG. It trades about 0.06 of its potential returns per unit of risk. KS AG DRC is currently generating about -0.04 per unit of risk. If you would invest 56,500 in Boswell J G on August 29, 2024 and sell it today you would earn a total of 1,000.00 from holding Boswell J G or generate 1.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Boswell J G vs. KS AG DRC
Performance |
| Timeline |
| Boswell J G |
| KS AG DRC |
Boswell J and KS AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boswell J and KS AG
The main advantage of trading using opposite Boswell J and KS AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boswell J position performs unexpectedly, KS AG 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 KS AG will offset losses from the drop in KS AG's long position.| Boswell J vs. KS AG DRC | Boswell J vs. ICL Israel Chemicals | Boswell J vs. CF Industries Holdings | Boswell J vs. The Mosaic |
| KS AG vs. Yara International ASA | KS AG vs. Boswell J G | KS AG vs. ICL Israel Chemicals | KS AG vs. CF Industries Holdings |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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