Correlation Between Kambi Group and Zaplox AB
Can any of the company-specific risk be diversified away by investing in both Kambi Group and Zaplox 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 Zaplox 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 Zaplox AB, you can compare the effects of market volatilities on Kambi Group and Zaplox 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 Zaplox AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kambi Group and Zaplox AB.
Diversification Opportunities for Kambi Group and Zaplox AB
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kambi and Zaplox is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Kambi Group PLC and Zaplox AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zaplox 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 Zaplox AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zaplox AB has no effect on the direction of Kambi Group i.e., Kambi Group and Zaplox AB go up and down completely randomly.
Pair Corralation between Kambi Group and Zaplox AB
Assuming the 90 days trading horizon Kambi Group PLC is expected to generate 0.85 times more return on investment than Zaplox AB. However, Kambi Group PLC is 1.17 times less risky than Zaplox AB. It trades about -0.37 of its potential returns per unit of risk. Zaplox AB is currently generating about -0.32 per unit of risk. If you would invest 13,520 in Kambi Group PLC on September 1, 2024 and sell it today you would lose (3,270) from holding Kambi Group PLC or give up 24.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kambi Group PLC vs. Zaplox AB
Performance |
| Timeline |
| Kambi Group PLC |
| Zaplox AB |
Kambi Group and Zaplox AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kambi Group and Zaplox AB
The main advantage of trading using opposite Kambi Group and Zaplox AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kambi Group position performs unexpectedly, Zaplox 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 Zaplox AB will offset losses from the drop in Zaplox 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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