Correlation Between KIM GROWTH and Idico JSC

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Can any of the company-specific risk be diversified away by investing in both KIM GROWTH and Idico JSC 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 KIM GROWTH and Idico JSC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KIM GROWTH VN and Idico JSC, you can compare the effects of market volatilities on KIM GROWTH and Idico JSC 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 KIM GROWTH with a short position of Idico JSC. Check out your portfolio center. Please also check ongoing floating volatility patterns of KIM GROWTH and Idico JSC.

Diversification Opportunities for KIM GROWTH and Idico JSC

-0.2
  Correlation Coefficient

Good diversification

The 3 months correlation between KIM and Idico is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding KIM GROWTH VN and Idico JSC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Idico JSC and KIM GROWTH 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 KIM GROWTH VN are associated (or correlated) with Idico JSC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Idico JSC has no effect on the direction of KIM GROWTH i.e., KIM GROWTH and Idico JSC go up and down completely randomly.

Pair Corralation between KIM GROWTH and Idico JSC

Assuming the 90 days trading horizon KIM GROWTH VN is expected to generate 0.98 times more return on investment than Idico JSC. However, KIM GROWTH VN is 1.02 times less risky than Idico JSC. It trades about 0.09 of its potential returns per unit of risk. Idico JSC is currently generating about 0.06 per unit of risk. If you would invest  1,201,000  in KIM GROWTH VN on November 27, 2024 and sell it today you would earn a total of  39,000  from holding KIM GROWTH VN or generate 3.25% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy59.32%
ValuesDaily Returns

KIM GROWTH VN  vs.  Idico JSC

 Performance 
       Timeline  
KIM GROWTH VN 

Risk-Adjusted Performance

OK

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in KIM GROWTH VN are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy forward indicators, KIM GROWTH is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.
Idico JSC 

Risk-Adjusted Performance

Modest

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Idico JSC are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy fundamental indicators, Idico JSC is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

KIM GROWTH and Idico JSC Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with KIM GROWTH and Idico JSC

The main advantage of trading using opposite KIM GROWTH and Idico JSC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KIM GROWTH position performs unexpectedly, Idico JSC 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 Idico JSC will offset losses from the drop in Idico JSC's long position.
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The idea behind KIM GROWTH VN and Idico JSC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.

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