Correlation Between CirChem AB and KABE Group
Can any of the company-specific risk be diversified away by investing in both CirChem AB and KABE Group 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 CirChem AB and KABE Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CirChem AB and KABE Group AB, you can compare the effects of market volatilities on CirChem AB and KABE Group 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 CirChem AB with a short position of KABE Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of CirChem AB and KABE Group.
Diversification Opportunities for CirChem AB and KABE Group
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between CirChem and KABE is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding CirChem AB and KABE Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KABE Group AB and CirChem AB 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 CirChem AB are associated (or correlated) with KABE Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KABE Group AB has no effect on the direction of CirChem AB i.e., CirChem AB and KABE Group go up and down completely randomly.
Pair Corralation between CirChem AB and KABE Group
Assuming the 90 days trading horizon CirChem AB is expected to generate 2.14 times less return on investment than KABE Group. In addition to that, CirChem AB is 2.48 times more volatile than KABE Group AB. It trades about 0.01 of its total potential returns per unit of risk. KABE Group AB is currently generating about 0.06 per unit of volatility. If you would invest 19,135 in KABE Group AB on September 3, 2024 and sell it today you would earn a total of 10,765 from holding KABE Group AB or generate 56.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CirChem AB vs. KABE Group AB
Performance |
| Timeline |
| CirChem AB |
| KABE Group AB |
CirChem AB and KABE Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CirChem AB and KABE Group
The main advantage of trading using opposite CirChem AB and KABE Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CirChem AB position performs unexpectedly, KABE Group 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 KABE Group will offset losses from the drop in KABE Group's long position.| CirChem AB vs. Intervacc AB | CirChem AB vs. Alzinova AB | CirChem AB vs. Clinical Laserthermia Systems | CirChem AB vs. AAC Clyde Space |
| KABE Group vs. Byggmax Group AB | KABE Group vs. Svedbergs i Dalstorp | KABE Group vs. Inwido AB | KABE Group vs. New Wave Group |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance |