Correlation Between GlaxoSmithKline PLC and KENYA AIRWAYS
Can any of the company-specific risk be diversified away by investing in both GlaxoSmithKline PLC and KENYA AIRWAYS 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 GlaxoSmithKline PLC and KENYA AIRWAYS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GlaxoSmithKline PLC ADR and KENYA AIRWAYS LTD, you can compare the effects of market volatilities on GlaxoSmithKline PLC and KENYA AIRWAYS 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 GlaxoSmithKline PLC with a short position of KENYA AIRWAYS. Check out your portfolio center. Please also check ongoing floating volatility patterns of GlaxoSmithKline PLC and KENYA AIRWAYS.
Diversification Opportunities for GlaxoSmithKline PLC and KENYA AIRWAYS
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between GlaxoSmithKline and KENYA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding GlaxoSmithKline PLC ADR and KENYA AIRWAYS LTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KENYA AIRWAYS LTD and GlaxoSmithKline PLC 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 GlaxoSmithKline PLC ADR are associated (or correlated) with KENYA AIRWAYS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KENYA AIRWAYS LTD has no effect on the direction of GlaxoSmithKline PLC i.e., GlaxoSmithKline PLC and KENYA AIRWAYS go up and down completely randomly.
Pair Corralation between GlaxoSmithKline PLC and KENYA AIRWAYS
If you would invest 3,273 in GlaxoSmithKline PLC ADR on August 31, 2024 and sell it today you would earn a total of 140.00 from holding GlaxoSmithKline PLC ADR or generate 4.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 98.13% |
| Values | Daily Returns |
GlaxoSmithKline PLC ADR vs. KENYA AIRWAYS LTD
Performance |
| Timeline |
| GlaxoSmithKline PLC ADR |
| KENYA AIRWAYS LTD |
GlaxoSmithKline PLC and KENYA AIRWAYS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GlaxoSmithKline PLC and KENYA AIRWAYS
The main advantage of trading using opposite GlaxoSmithKline PLC and KENYA AIRWAYS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GlaxoSmithKline PLC position performs unexpectedly, KENYA AIRWAYS 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 KENYA AIRWAYS will offset losses from the drop in KENYA AIRWAYS's long position.| GlaxoSmithKline PLC vs. Novartis AG ADR | GlaxoSmithKline PLC vs. AstraZeneca PLC ADR | GlaxoSmithKline PLC vs. Roche Holding Ltd | GlaxoSmithKline PLC vs. Bristol Myers Squibb |
| KENYA AIRWAYS vs. MAENDELEO BANK PLC | KENYA AIRWAYS vs. AFRIPRISE INVESTMENT PLC | KENYA AIRWAYS vs. SWISSPORT TANZANIA LTD | KENYA AIRWAYS vs. MKOMBOZI MERCIAL BANK |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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