Correlation Between Dixons Carphone and Kambi Group
Can any of the company-specific risk be diversified away by investing in both Dixons Carphone and Kambi 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 Dixons Carphone and Kambi Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dixons Carphone plc and Kambi Group plc, you can compare the effects of market volatilities on Dixons Carphone and Kambi 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 Dixons Carphone with a short position of Kambi Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dixons Carphone and Kambi Group.
Diversification Opportunities for Dixons Carphone and Kambi Group
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Dixons and Kambi is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Dixons Carphone plc and Kambi Group plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kambi Group plc and Dixons Carphone 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 Dixons Carphone plc are associated (or correlated) with Kambi Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kambi Group plc has no effect on the direction of Dixons Carphone i.e., Dixons Carphone and Kambi Group go up and down completely randomly.
Pair Corralation between Dixons Carphone and Kambi Group
Assuming the 90 days horizon Dixons Carphone is expected to generate 48.15 times less return on investment than Kambi Group. But when comparing it to its historical volatility, Dixons Carphone plc is 1.74 times less risky than Kambi Group. It trades about 0.01 of its potential returns per unit of risk. Kambi Group plc is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 958.00 in Kambi Group plc on November 3, 2024 and sell it today you would earn a total of 162.00 from holding Kambi Group plc or generate 16.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Dixons Carphone plc vs. Kambi Group plc
Performance |
| Timeline |
| Dixons Carphone plc |
| Kambi Group plc |
Dixons Carphone and Kambi Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dixons Carphone and Kambi Group
The main advantage of trading using opposite Dixons Carphone and Kambi Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dixons Carphone position performs unexpectedly, Kambi 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 Kambi Group will offset losses from the drop in Kambi Group's long position.| Dixons Carphone vs. Nasdaq Inc | Dixons Carphone vs. Aldel Financial II | Dixons Carphone vs. Tandem Diabetes Care | Dixons Carphone vs. National Vision Holdings |
| Kambi Group vs. Light Wonder | Kambi Group vs. Everi Holdings | Kambi Group vs. PlayAGS | Kambi Group vs. Accel Entertainment |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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