Correlation Between Kool2play and Stalprodukt
Can any of the company-specific risk be diversified away by investing in both Kool2play and Stalprodukt 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 Kool2play and Stalprodukt into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kool2play SA and Stalprodukt SA, you can compare the effects of market volatilities on Kool2play and Stalprodukt 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 Kool2play with a short position of Stalprodukt. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kool2play and Stalprodukt.
Diversification Opportunities for Kool2play and Stalprodukt
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kool2play and Stalprodukt is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Kool2play SA and Stalprodukt SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stalprodukt SA and Kool2play 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 Kool2play SA are associated (or correlated) with Stalprodukt. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stalprodukt SA has no effect on the direction of Kool2play i.e., Kool2play and Stalprodukt go up and down completely randomly.
Pair Corralation between Kool2play and Stalprodukt
Assuming the 90 days trading horizon Kool2play SA is expected to under-perform the Stalprodukt. In addition to that, Kool2play is 4.12 times more volatile than Stalprodukt SA. It trades about -0.02 of its total potential returns per unit of risk. Stalprodukt SA is currently generating about 0.0 per unit of volatility. If you would invest 24,500 in Stalprodukt SA on September 2, 2024 and sell it today you would lose (2,200) from holding Stalprodukt SA or give up 8.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 87.3% |
| Values | Daily Returns |
Kool2play SA vs. Stalprodukt SA
Performance |
| Timeline |
| Kool2play SA |
| Stalprodukt SA |
Kool2play and Stalprodukt Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kool2play and Stalprodukt
The main advantage of trading using opposite Kool2play and Stalprodukt positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kool2play position performs unexpectedly, Stalprodukt 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 Stalprodukt will offset losses from the drop in Stalprodukt's long position.| Kool2play vs. Clean Carbon Energy | Kool2play vs. ADX | Kool2play vs. Agroliga Group PLC | Kool2play vs. Vee SA |
| Stalprodukt vs. Echo Investment SA | Stalprodukt vs. Esotiq Henderson SA | Stalprodukt vs. Asseco South Eastern | Stalprodukt vs. Vercom 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |