Correlation Between Kambi Group and Genovis AB
Can any of the company-specific risk be diversified away by investing in both Kambi Group and Genovis AB 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 Kambi Group and Genovis AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kambi Group PLC and Genovis AB, you can compare the effects of market volatilities on Kambi Group and Genovis AB 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 Kambi Group with a short position of Genovis AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kambi Group and Genovis AB.
Diversification Opportunities for Kambi Group and Genovis AB
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kambi and Genovis is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Kambi Group PLC and Genovis AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genovis AB and Kambi 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 Kambi Group PLC are associated (or correlated) with Genovis AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genovis AB has no effect on the direction of Kambi Group i.e., Kambi Group and Genovis AB go up and down completely randomly.
Pair Corralation between Kambi Group and Genovis AB
Assuming the 90 days trading horizon Kambi Group PLC is expected to under-perform the Genovis AB. But the stock apears to be less risky and, when comparing its historical volatility, Kambi Group PLC is 2.05 times less risky than Genovis AB. The stock trades about -0.37 of its potential returns per unit of risk. The Genovis AB is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 2,175 in Genovis AB on September 1, 2024 and sell it today you would earn a total of 450.00 from holding Genovis AB or generate 20.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kambi Group PLC vs. Genovis AB
Performance |
| Timeline |
| Kambi Group PLC |
| Genovis AB |
Kambi Group and Genovis AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kambi Group and Genovis AB
The main advantage of trading using opposite Kambi Group and Genovis AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kambi Group position performs unexpectedly, Genovis AB 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 Genovis AB will offset losses from the drop in Genovis AB's long position.| Kambi Group vs. Evolution AB | Kambi Group vs. Embracer Group AB | Kambi Group vs. Betsson AB | Kambi Group vs. Catena Media plc |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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