Correlation Between K2A Knaust and Bonzun AB
Can any of the company-specific risk be diversified away by investing in both K2A Knaust and Bonzun AB 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 K2A Knaust and Bonzun AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between K2A Knaust Andersson and Bonzun AB, you can compare the effects of market volatilities on K2A Knaust and Bonzun AB 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 K2A Knaust with a short position of Bonzun AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of K2A Knaust and Bonzun AB.
Diversification Opportunities for K2A Knaust and Bonzun AB
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between K2A and Bonzun is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding K2A Knaust Andersson and Bonzun AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bonzun AB and K2A Knaust 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 K2A Knaust Andersson are associated (or correlated) with Bonzun AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bonzun AB has no effect on the direction of K2A Knaust i.e., K2A Knaust and Bonzun AB go up and down completely randomly.
Pair Corralation between K2A Knaust and Bonzun AB
Assuming the 90 days trading horizon K2A Knaust Andersson is expected to under-perform the Bonzun AB. But the stock apears to be less risky and, when comparing its historical volatility, K2A Knaust Andersson is 2.75 times less risky than Bonzun AB. The stock trades about -0.33 of its potential returns per unit of risk. The Bonzun AB is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 0.96 in Bonzun AB on September 1, 2024 and sell it today you would lose (0.10) from holding Bonzun AB or give up 10.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
K2A Knaust Andersson vs. Bonzun AB
Performance |
| Timeline |
| K2A Knaust Andersson |
| Bonzun AB |
K2A Knaust and Bonzun AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with K2A Knaust and Bonzun AB
The main advantage of trading using opposite K2A Knaust and Bonzun AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if K2A Knaust position performs unexpectedly, Bonzun AB 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 Bonzun AB will offset losses from the drop in Bonzun AB's long position.| K2A Knaust vs. Fastighets AB Balder | K2A Knaust vs. Fabege AB | K2A Knaust vs. Wihlborgs Fastigheter AB | K2A Knaust vs. Castellum AB |
| Bonzun AB vs. AVTECH Sweden AB | Bonzun AB vs. K2A Knaust Andersson | Bonzun AB vs. eEducation Albert AB | Bonzun AB vs. Footway Group AB |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |