Correlation Between Kap Industrial and Hammerson PLC
Can any of the company-specific risk be diversified away by investing in both Kap Industrial and Hammerson PLC 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 Kap Industrial and Hammerson PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kap Industrial Holdings and Hammerson PLC, you can compare the effects of market volatilities on Kap Industrial and Hammerson PLC 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 Kap Industrial with a short position of Hammerson PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kap Industrial and Hammerson PLC.
Diversification Opportunities for Kap Industrial and Hammerson PLC
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kap and Hammerson is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Kap Industrial Holdings and Hammerson PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hammerson PLC and Kap Industrial 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 Kap Industrial Holdings are associated (or correlated) with Hammerson PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hammerson PLC has no effect on the direction of Kap Industrial i.e., Kap Industrial and Hammerson PLC go up and down completely randomly.
Pair Corralation between Kap Industrial and Hammerson PLC
Assuming the 90 days trading horizon Kap Industrial Holdings is expected to generate 2.12 times more return on investment than Hammerson PLC. However, Kap Industrial is 2.12 times more volatile than Hammerson PLC. It trades about -0.01 of its potential returns per unit of risk. Hammerson PLC is currently generating about -0.07 per unit of risk. If you would invest 33,300 in Kap Industrial Holdings on September 2, 2024 and sell it today you would lose (300.00) from holding Kap Industrial Holdings or give up 0.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kap Industrial Holdings vs. Hammerson PLC
Performance |
| Timeline |
| Kap Industrial Holdings |
| Hammerson PLC |
Kap Industrial and Hammerson PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kap Industrial and Hammerson PLC
The main advantage of trading using opposite Kap Industrial and Hammerson PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kap Industrial position performs unexpectedly, Hammerson PLC 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 Hammerson PLC will offset losses from the drop in Hammerson PLC's long position.| Kap Industrial vs. Deneb Investments | Kap Industrial vs. Centaur Bci Balanced | Kap Industrial vs. Sabvest Capital | Kap Industrial vs. AfricaRhodium ETF |
| Hammerson PLC vs. HomeChoice Investments | Hammerson PLC vs. Kap Industrial Holdings | Hammerson PLC vs. Bytes Technology | Hammerson PLC vs. Master Drilling 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |