Correlation Between Kajima Corp and Badger Infrastructure
Can any of the company-specific risk be diversified away by investing in both Kajima Corp and Badger Infrastructure 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 Kajima Corp and Badger Infrastructure into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kajima Corp ADR and Badger Infrastructure Solutions, you can compare the effects of market volatilities on Kajima Corp and Badger Infrastructure 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 Kajima Corp with a short position of Badger Infrastructure. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kajima Corp and Badger Infrastructure.
Diversification Opportunities for Kajima Corp and Badger Infrastructure
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kajima and Badger is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Kajima Corp ADR and Badger Infrastructure Solution in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Badger Infrastructure and Kajima Corp 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 Kajima Corp ADR are associated (or correlated) with Badger Infrastructure. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Badger Infrastructure has no effect on the direction of Kajima Corp i.e., Kajima Corp and Badger Infrastructure go up and down completely randomly.
Pair Corralation between Kajima Corp and Badger Infrastructure
Assuming the 90 days horizon Kajima Corp ADR is expected to generate 1.14 times more return on investment than Badger Infrastructure. However, Kajima Corp is 1.14 times more volatile than Badger Infrastructure Solutions. It trades about 0.05 of its potential returns per unit of risk. Badger Infrastructure Solutions is currently generating about -0.08 per unit of risk. If you would invest 1,709 in Kajima Corp ADR on August 29, 2024 and sell it today you would earn a total of 41.00 from holding Kajima Corp ADR or generate 2.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kajima Corp ADR vs. Badger Infrastructure Solution
Performance |
| Timeline |
| Kajima Corp ADR |
| Badger Infrastructure |
Kajima Corp and Badger Infrastructure Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kajima Corp and Badger Infrastructure
The main advantage of trading using opposite Kajima Corp and Badger Infrastructure positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kajima Corp position performs unexpectedly, Badger Infrastructure 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 Badger Infrastructure will offset losses from the drop in Badger Infrastructure's long position.| Kajima Corp vs. ACS Actividades De | Kajima Corp vs. IES Holdings | Kajima Corp vs. Acciona SA | Kajima Corp vs. JGC Corp |
| Badger Infrastructure vs. ACS Actividades De | Badger Infrastructure vs. Arcadis NV | Badger Infrastructure vs. Acciona SA | Badger Infrastructure vs. JGC Corp |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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