Correlation Between KABE Group and Egetis Therapeutics
Can any of the company-specific risk be diversified away by investing in both KABE Group and Egetis Therapeutics 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 Egetis Therapeutics 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 Egetis Therapeutics AB, you can compare the effects of market volatilities on KABE Group and Egetis Therapeutics 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 Egetis Therapeutics. Check out your portfolio center. Please also check ongoing floating volatility patterns of KABE Group and Egetis Therapeutics.
Diversification Opportunities for KABE Group and Egetis Therapeutics
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between KABE and Egetis is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding KABE Group AB and Egetis Therapeutics AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Egetis Therapeutics 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 Egetis Therapeutics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Egetis Therapeutics has no effect on the direction of KABE Group i.e., KABE Group and Egetis Therapeutics go up and down completely randomly.
Pair Corralation between KABE Group and Egetis Therapeutics
Assuming the 90 days trading horizon KABE Group is expected to generate 12.43 times less return on investment than Egetis Therapeutics. But when comparing it to its historical volatility, KABE Group AB is 2.45 times less risky than Egetis Therapeutics. It trades about 0.01 of its potential returns per unit of risk. Egetis Therapeutics AB is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 489.00 in Egetis Therapeutics AB on September 3, 2024 and sell it today you would earn a total of 72.00 from holding Egetis Therapeutics AB or generate 14.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KABE Group AB vs. Egetis Therapeutics AB
Performance |
| Timeline |
| KABE Group AB |
| Egetis Therapeutics |
KABE Group and Egetis Therapeutics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KABE Group and Egetis Therapeutics
The main advantage of trading using opposite KABE Group and Egetis Therapeutics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KABE Group position performs unexpectedly, Egetis Therapeutics 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 Egetis Therapeutics will offset losses from the drop in Egetis Therapeutics' 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 |
| Egetis Therapeutics vs. Simris Alg AB | Egetis Therapeutics vs. Immunovia publ AB | Egetis Therapeutics vs. Sedana Medical AB | Egetis Therapeutics vs. KABE 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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