Correlation Between Ekinops SA and Kko International
Can any of the company-specific risk be diversified away by investing in both Ekinops SA and Kko International 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 Ekinops SA and Kko International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ekinops SA and Kko International SA, you can compare the effects of market volatilities on Ekinops SA and Kko International 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 Ekinops SA with a short position of Kko International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ekinops SA and Kko International.
Diversification Opportunities for Ekinops SA and Kko International
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Ekinops and Kko is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Ekinops SA and Kko International SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kko International and Ekinops SA 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 Ekinops SA are associated (or correlated) with Kko International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kko International has no effect on the direction of Ekinops SA i.e., Ekinops SA and Kko International go up and down completely randomly.
Pair Corralation between Ekinops SA and Kko International
Assuming the 90 days trading horizon Ekinops SA is expected to generate 26.24 times less return on investment than Kko International. But when comparing it to its historical volatility, Ekinops SA is 4.68 times less risky than Kko International. It trades about 0.02 of its potential returns per unit of risk. Kko International SA is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 6.32 in Kko International SA on August 30, 2024 and sell it today you would earn a total of 4.68 from holding Kko International SA or generate 74.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ekinops SA vs. Kko International SA
Performance |
| Timeline |
| Ekinops SA |
| Kko International |
Ekinops SA and Kko International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ekinops SA and Kko International
The main advantage of trading using opposite Ekinops SA and Kko International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ekinops SA position performs unexpectedly, Kko International 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 Kko International will offset losses from the drop in Kko International's long position.| Ekinops SA vs. Claranova SE | Ekinops SA vs. Derichebourg | Ekinops SA vs. Mersen SA | Ekinops SA vs. BigBen Interactive |
| Kko International vs. Agrogeneration | Kko International vs. Safe Orthopaedics SA | Kko International vs. DBT SA | Kko International vs. Acheter Louer |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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