Correlation Between Kingsmen CMTI and KC Metalsheet
Can any of the company-specific risk be diversified away by investing in both Kingsmen CMTI and KC Metalsheet 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 Kingsmen CMTI and KC Metalsheet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kingsmen CMTI Public and KC Metalsheet Public, you can compare the effects of market volatilities on Kingsmen CMTI and KC Metalsheet 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 Kingsmen CMTI with a short position of KC Metalsheet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kingsmen CMTI and KC Metalsheet.
Diversification Opportunities for Kingsmen CMTI and KC Metalsheet
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kingsmen and KCM is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Kingsmen CMTI Public and KC Metalsheet Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KC Metalsheet Public and Kingsmen CMTI 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 Kingsmen CMTI Public are associated (or correlated) with KC Metalsheet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KC Metalsheet Public has no effect on the direction of Kingsmen CMTI i.e., Kingsmen CMTI and KC Metalsheet go up and down completely randomly.
Pair Corralation between Kingsmen CMTI and KC Metalsheet
Given the investment horizon of 90 days Kingsmen CMTI Public is expected to generate 1.73 times more return on investment than KC Metalsheet. However, Kingsmen CMTI is 1.73 times more volatile than KC Metalsheet Public. It trades about -0.05 of its potential returns per unit of risk. KC Metalsheet Public is currently generating about -0.36 per unit of risk. If you would invest 130.00 in Kingsmen CMTI Public on August 29, 2024 and sell it today you would lose (6.00) from holding Kingsmen CMTI Public or give up 4.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kingsmen CMTI Public vs. KC Metalsheet Public
Performance |
| Timeline |
| Kingsmen CMTI Public |
| KC Metalsheet Public |
Kingsmen CMTI and KC Metalsheet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kingsmen CMTI and KC Metalsheet
The main advantage of trading using opposite Kingsmen CMTI and KC Metalsheet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kingsmen CMTI position performs unexpectedly, KC Metalsheet 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 KC Metalsheet will offset losses from the drop in KC Metalsheet's long position.| Kingsmen CMTI vs. Com7 PCL | Kingsmen CMTI vs. TKS Technologies Public | Kingsmen CMTI vs. Rajthanee Hospital Public | Kingsmen CMTI vs. The Erawan Group |
| KC Metalsheet vs. Masterkool International Public | KC Metalsheet vs. Kingsmen CMTI Public | KC Metalsheet vs. Hydrotek Public | KC Metalsheet vs. Home Pottery Public |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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