Correlation Between Creative Media and Kingstone Companies
Can any of the company-specific risk be diversified away by investing in both Creative Media and Kingstone Companies 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 Creative Media and Kingstone Companies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Creative Media Community and Kingstone Companies, you can compare the effects of market volatilities on Creative Media and Kingstone Companies 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 Creative Media with a short position of Kingstone Companies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Creative Media and Kingstone Companies.
Diversification Opportunities for Creative Media and Kingstone Companies
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Creative and Kingstone is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Creative Media Community and Kingstone Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kingstone Companies and Creative Media 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 Creative Media Community are associated (or correlated) with Kingstone Companies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kingstone Companies has no effect on the direction of Creative Media i.e., Creative Media and Kingstone Companies go up and down completely randomly.
Pair Corralation between Creative Media and Kingstone Companies
Given the investment horizon of 90 days Creative Media Community is expected to under-perform the Kingstone Companies. In addition to that, Creative Media is 1.46 times more volatile than Kingstone Companies. It trades about -0.39 of its total potential returns per unit of risk. Kingstone Companies is currently generating about 0.45 per unit of volatility. If you would invest 973.00 in Kingstone Companies on August 29, 2024 and sell it today you would earn a total of 623.00 from holding Kingstone Companies or generate 64.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Creative Media Community vs. Kingstone Companies
Performance |
| Timeline |
| Creative Media Community |
| Kingstone Companies |
Creative Media and Kingstone Companies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Creative Media and Kingstone Companies
The main advantage of trading using opposite Creative Media and Kingstone Companies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Creative Media position performs unexpectedly, Kingstone Companies 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 Kingstone Companies will offset losses from the drop in Kingstone Companies' long position.| Creative Media vs. Cousins Properties Incorporated | Creative Media vs. Highwoods Properties | Creative Media vs. Douglas Emmett | Creative Media vs. Equity Commonwealth |
| Kingstone Companies vs. HCI Group | Kingstone Companies vs. Universal Insurance Holdings | Kingstone Companies vs. Horace Mann Educators | Kingstone Companies vs. Heritage Insurance Hldgs |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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