Correlation Between KABE Group and Eastnine
Can any of the company-specific risk be diversified away by investing in both KABE Group and Eastnine 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 KABE Group and Eastnine into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KABE Group AB and Eastnine AB, you can compare the effects of market volatilities on KABE Group and Eastnine 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 KABE Group with a short position of Eastnine. Check out your portfolio center. Please also check ongoing floating volatility patterns of KABE Group and Eastnine.
Diversification Opportunities for KABE Group and Eastnine
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KABE and Eastnine is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding KABE Group AB and Eastnine AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastnine AB and KABE Group 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 KABE Group AB are associated (or correlated) with Eastnine. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastnine AB has no effect on the direction of KABE Group i.e., KABE Group and Eastnine go up and down completely randomly.
Pair Corralation between KABE Group and Eastnine
Assuming the 90 days trading horizon KABE Group AB is expected to under-perform the Eastnine. But the stock apears to be less risky and, when comparing its historical volatility, KABE Group AB is 1.52 times less risky than Eastnine. The stock trades about -0.21 of its potential returns per unit of risk. The Eastnine AB is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 4,524 in Eastnine AB on September 14, 2024 and sell it today you would earn a total of 224.00 from holding Eastnine AB or generate 4.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
KABE Group AB vs. Eastnine AB
Performance |
| Timeline |
| KABE Group AB |
| Eastnine AB |
KABE Group and Eastnine Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KABE Group and Eastnine
The main advantage of trading using opposite KABE Group and Eastnine positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KABE Group position performs unexpectedly, Eastnine 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 Eastnine will offset losses from the drop in Eastnine's long position.| KABE Group vs. Byggmax Group AB | KABE Group vs. Svedbergs i Dalstorp | KABE Group vs. Inwido AB | KABE Group vs. New Wave Group |
| Eastnine vs. Catella AB | Eastnine vs. Catella AB A | Eastnine vs. KABE Group AB | Eastnine vs. IAR Systems Group |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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