Correlation Between International Business and Konami Holdings
Can any of the company-specific risk be diversified away by investing in both International Business and Konami Holdings 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 International Business and Konami Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Business Machines and Konami Holdings, you can compare the effects of market volatilities on International Business and Konami Holdings 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 International Business with a short position of Konami Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Business and Konami Holdings.
Diversification Opportunities for International Business and Konami Holdings
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between International and Konami is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding International Business Machine and Konami Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Konami Holdings and International Business 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 International Business Machines are associated (or correlated) with Konami Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Konami Holdings has no effect on the direction of International Business i.e., International Business and Konami Holdings go up and down completely randomly.
Pair Corralation between International Business and Konami Holdings
Considering the 90-day investment horizon International Business is expected to generate 1.06 times less return on investment than Konami Holdings. But when comparing it to its historical volatility, International Business Machines is 1.52 times less risky than Konami Holdings. It trades about 0.21 of its potential returns per unit of risk. Konami Holdings is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 3,425 in Konami Holdings on August 28, 2024 and sell it today you would earn a total of 1,349 from holding Konami Holdings or generate 39.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.21% |
| Values | Daily Returns |
International Business Machine vs. Konami Holdings
Performance |
| Timeline |
| International Business |
| Konami Holdings |
International Business and Konami Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Business and Konami Holdings
The main advantage of trading using opposite International Business and Konami Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Business position performs unexpectedly, Konami Holdings 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 Konami Holdings will offset losses from the drop in Konami Holdings' long position.| International Business vs. Data Storage Corp | International Business vs. Usio Inc | International Business vs. ARB IOT Group | International Business vs. FiscalNote Holdings |
| Konami Holdings vs. NEXON Co | Konami Holdings vs. Sega Sammy Holdings | Konami Holdings vs. Capcom Co Ltd | Konami Holdings vs. CD Projekt SA |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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