Correlation Between Dustin Group and Kjell Group
Can any of the company-specific risk be diversified away by investing in both Dustin Group and Kjell 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 Dustin Group and Kjell Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dustin Group AB and Kjell Group AB, you can compare the effects of market volatilities on Dustin Group and Kjell 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 Dustin Group with a short position of Kjell Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dustin Group and Kjell Group.
Diversification Opportunities for Dustin Group and Kjell Group
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dustin and Kjell is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Dustin Group AB and Kjell Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kjell Group AB and Dustin Group 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 Dustin Group AB are associated (or correlated) with Kjell Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kjell Group AB has no effect on the direction of Dustin Group i.e., Dustin Group and Kjell Group go up and down completely randomly.
Pair Corralation between Dustin Group and Kjell Group
Assuming the 90 days trading horizon Dustin Group AB is expected to generate 0.76 times more return on investment than Kjell Group. However, Dustin Group AB is 1.32 times less risky than Kjell Group. It trades about -0.43 of its potential returns per unit of risk. Kjell Group AB is currently generating about -0.56 per unit of risk. If you would invest 782.00 in Dustin Group AB on August 25, 2024 and sell it today you would lose (145.00) from holding Dustin Group AB or give up 18.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dustin Group AB vs. Kjell Group AB
Performance |
| Timeline |
| Dustin Group AB |
| Kjell Group AB |
Dustin Group and Kjell Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dustin Group and Kjell Group
The main advantage of trading using opposite Dustin Group and Kjell Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dustin Group position performs unexpectedly, Kjell 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 Kjell Group will offset losses from the drop in Kjell Group's long position.| Dustin Group vs. New Wave Group | Dustin Group vs. Clas Ohlson AB | Dustin Group vs. BE Group AB | Dustin Group vs. Betsson AB |
| Kjell Group vs. Clas Ohlson AB | Kjell Group vs. Ctek AB | Kjell Group vs. Truecaller AB | Kjell Group vs. Dustin Group AB |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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