Correlation Between Givaudan and Kuehne Nagel
Can any of the company-specific risk be diversified away by investing in both Givaudan and Kuehne Nagel 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 Givaudan and Kuehne Nagel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Givaudan SA and Kuehne Nagel, you can compare the effects of market volatilities on Givaudan and Kuehne Nagel 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 Givaudan with a short position of Kuehne Nagel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Givaudan and Kuehne Nagel.
Diversification Opportunities for Givaudan and Kuehne Nagel
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Givaudan and Kuehne is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Givaudan SA and Kuehne Nagel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuehne Nagel and Givaudan 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 Givaudan SA are associated (or correlated) with Kuehne Nagel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuehne Nagel has no effect on the direction of Givaudan i.e., Givaudan and Kuehne Nagel go up and down completely randomly.
Pair Corralation between Givaudan and Kuehne Nagel
Assuming the 90 days trading horizon Givaudan SA is expected to under-perform the Kuehne Nagel. In addition to that, Givaudan is 1.14 times more volatile than Kuehne Nagel. It trades about -0.04 of its total potential returns per unit of risk. Kuehne Nagel is currently generating about 0.19 per unit of volatility. If you would invest 20,690 in Kuehne Nagel on November 28, 2024 and sell it today you would earn a total of 980.00 from holding Kuehne Nagel or generate 4.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Givaudan SA vs. Kuehne Nagel
Performance |
| Timeline |
| Givaudan SA |
| Kuehne Nagel |
Givaudan and Kuehne Nagel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Givaudan and Kuehne Nagel
The main advantage of trading using opposite Givaudan and Kuehne Nagel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Givaudan position performs unexpectedly, Kuehne Nagel 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 Kuehne Nagel will offset losses from the drop in Kuehne Nagel's long position.The idea behind Givaudan SA and Kuehne Nagel 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.| Kuehne Nagel vs. Geberit AG | Kuehne Nagel vs. Givaudan SA | Kuehne Nagel vs. SGS SA | Kuehne Nagel vs. Swiss Life Holding |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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