Correlation Between REVO INSURANCE and KWS SAAT
Can any of the company-specific risk be diversified away by investing in both REVO INSURANCE and KWS SAAT 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 REVO INSURANCE and KWS SAAT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between REVO INSURANCE SPA and KWS SAAT SE, you can compare the effects of market volatilities on REVO INSURANCE and KWS SAAT 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 REVO INSURANCE with a short position of KWS SAAT. Check out your portfolio center. Please also check ongoing floating volatility patterns of REVO INSURANCE and KWS SAAT.
Diversification Opportunities for REVO INSURANCE and KWS SAAT
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between REVO and KWS is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding REVO INSURANCE SPA and KWS SAAT SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KWS SAAT SE and REVO INSURANCE 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 REVO INSURANCE SPA are associated (or correlated) with KWS SAAT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KWS SAAT SE has no effect on the direction of REVO INSURANCE i.e., REVO INSURANCE and KWS SAAT go up and down completely randomly.
Pair Corralation between REVO INSURANCE and KWS SAAT
Assuming the 90 days horizon REVO INSURANCE SPA is expected to generate 0.7 times more return on investment than KWS SAAT. However, REVO INSURANCE SPA is 1.42 times less risky than KWS SAAT. It trades about 0.06 of its potential returns per unit of risk. KWS SAAT SE is currently generating about 0.02 per unit of risk. If you would invest 859.00 in REVO INSURANCE SPA on September 4, 2024 and sell it today you would earn a total of 221.00 from holding REVO INSURANCE SPA or generate 25.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.74% |
| Values | Daily Returns |
REVO INSURANCE SPA vs. KWS SAAT SE
Performance |
| Timeline |
| REVO INSURANCE SPA |
| KWS SAAT SE |
REVO INSURANCE and KWS SAAT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with REVO INSURANCE and KWS SAAT
The main advantage of trading using opposite REVO INSURANCE and KWS SAAT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if REVO INSURANCE position performs unexpectedly, KWS SAAT 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 KWS SAAT will offset losses from the drop in KWS SAAT's long position.| REVO INSURANCE vs. Alfa Financial Software | REVO INSURANCE vs. AXWAY SOFTWARE EO | REVO INSURANCE vs. National Beverage Corp | REVO INSURANCE vs. ETFS Coffee ETC |
| KWS SAAT vs. Archer Daniels Midland | KWS SAAT vs. Tyson Foods | KWS SAAT vs. Wilmar International Limited | KWS SAAT vs. SalMar ASA |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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