Correlation Between Kap Industrial and Indexco Limited
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By analyzing existing cross correlation between Kap Industrial Holdings and Indexco Limited , you can compare the effects of market volatilities on Kap Industrial and Indexco Limited 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 Indexco Limited. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kap Industrial and Indexco Limited.
Diversification Opportunities for Kap Industrial and Indexco Limited
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Kap and Indexco is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Kap Industrial Holdings and Indexco Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Indexco Limited 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 Indexco Limited. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Indexco Limited has no effect on the direction of Kap Industrial i.e., Kap Industrial and Indexco Limited go up and down completely randomly.
Pair Corralation between Kap Industrial and Indexco Limited
Assuming the 90 days trading horizon Kap Industrial Holdings is expected to under-perform the Indexco Limited. In addition to that, Kap Industrial is 3.22 times more volatile than Indexco Limited . It trades about -0.12 of its total potential returns per unit of risk. Indexco Limited is currently generating about -0.24 per unit of volatility. If you would invest 439,500 in Indexco Limited on August 30, 2024 and sell it today you would lose (13,700) from holding Indexco Limited or give up 3.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Kap Industrial Holdings vs. Indexco Limited
Performance |
| Timeline |
| Kap Industrial Holdings |
| Indexco Limited |
Kap Industrial and Indexco Limited Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kap Industrial and Indexco Limited
The main advantage of trading using opposite Kap Industrial and Indexco Limited positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kap Industrial position performs unexpectedly, Indexco Limited 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 Indexco Limited will offset losses from the drop in Indexco Limited's long position.| Kap Industrial vs. Bytes Technology | Kap Industrial vs. Reinet Investments SCA | Kap Industrial vs. Brimstone Investment | Kap Industrial vs. Deneb Investments |
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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