Correlation Between KENEDIX OFFICE and AECOM TECHNOLOGY
Can any of the company-specific risk be diversified away by investing in both KENEDIX OFFICE and AECOM TECHNOLOGY 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 KENEDIX OFFICE and AECOM TECHNOLOGY into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KENEDIX OFFICE INV and AECOM TECHNOLOGY, you can compare the effects of market volatilities on KENEDIX OFFICE and AECOM TECHNOLOGY 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 KENEDIX OFFICE with a short position of AECOM TECHNOLOGY. Check out your portfolio center. Please also check ongoing floating volatility patterns of KENEDIX OFFICE and AECOM TECHNOLOGY.
Diversification Opportunities for KENEDIX OFFICE and AECOM TECHNOLOGY
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between KENEDIX and AECOM is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding KENEDIX OFFICE INV and AECOM TECHNOLOGY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AECOM TECHNOLOGY and KENEDIX OFFICE 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 KENEDIX OFFICE INV are associated (or correlated) with AECOM TECHNOLOGY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AECOM TECHNOLOGY has no effect on the direction of KENEDIX OFFICE i.e., KENEDIX OFFICE and AECOM TECHNOLOGY go up and down completely randomly.
Pair Corralation between KENEDIX OFFICE and AECOM TECHNOLOGY
Assuming the 90 days horizon KENEDIX OFFICE is expected to generate 2.56 times less return on investment than AECOM TECHNOLOGY. But when comparing it to its historical volatility, KENEDIX OFFICE INV is 1.14 times less risky than AECOM TECHNOLOGY. It trades about 0.02 of its potential returns per unit of risk. AECOM TECHNOLOGY is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 10,400 in AECOM TECHNOLOGY on September 13, 2024 and sell it today you would earn a total of 200.00 from holding AECOM TECHNOLOGY or generate 1.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
KENEDIX OFFICE INV vs. AECOM TECHNOLOGY
Performance |
| Timeline |
| KENEDIX OFFICE INV |
| AECOM TECHNOLOGY |
KENEDIX OFFICE and AECOM TECHNOLOGY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KENEDIX OFFICE and AECOM TECHNOLOGY
The main advantage of trading using opposite KENEDIX OFFICE and AECOM TECHNOLOGY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KENEDIX OFFICE position performs unexpectedly, AECOM TECHNOLOGY 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 AECOM TECHNOLOGY will offset losses from the drop in AECOM TECHNOLOGY's long position.| KENEDIX OFFICE vs. Apple Inc | KENEDIX OFFICE vs. Apple Inc | KENEDIX OFFICE vs. Apple Inc | KENEDIX OFFICE vs. Apple Inc |
| AECOM TECHNOLOGY vs. Apple Inc | AECOM TECHNOLOGY vs. Apple Inc | AECOM TECHNOLOGY vs. Apple Inc | AECOM TECHNOLOGY vs. Apple Inc |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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