Correlation Between Kingsoft Cloud and Relx PLC
Can any of the company-specific risk be diversified away by investing in both Kingsoft Cloud and Relx 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 Kingsoft Cloud and Relx PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kingsoft Cloud Holdings and Relx PLC ADR, you can compare the effects of market volatilities on Kingsoft Cloud and Relx 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 Kingsoft Cloud with a short position of Relx PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kingsoft Cloud and Relx PLC.
Diversification Opportunities for Kingsoft Cloud and Relx PLC
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kingsoft and Relx is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Kingsoft Cloud Holdings and Relx PLC ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Relx PLC ADR and Kingsoft Cloud 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 Kingsoft Cloud Holdings are associated (or correlated) with Relx PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Relx PLC ADR has no effect on the direction of Kingsoft Cloud i.e., Kingsoft Cloud and Relx PLC go up and down completely randomly.
Pair Corralation between Kingsoft Cloud and Relx PLC
Allowing for the 90-day total investment horizon Kingsoft Cloud Holdings is expected to generate 5.72 times more return on investment than Relx PLC. However, Kingsoft Cloud is 5.72 times more volatile than Relx PLC ADR. It trades about 0.04 of its potential returns per unit of risk. Relx PLC ADR is currently generating about 0.11 per unit of risk. If you would invest 537.00 in Kingsoft Cloud Holdings on August 27, 2024 and sell it today you would earn a total of 184.00 from holding Kingsoft Cloud Holdings or generate 34.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kingsoft Cloud Holdings vs. Relx PLC ADR
Performance |
| Timeline |
| Kingsoft Cloud Holdings |
| Relx PLC ADR |
Kingsoft Cloud and Relx PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kingsoft Cloud and Relx PLC
The main advantage of trading using opposite Kingsoft Cloud and Relx PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kingsoft Cloud position performs unexpectedly, Relx 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 Relx PLC will offset losses from the drop in Relx PLC's long position.| Kingsoft Cloud vs. Oneconnect Financial Technology | Kingsoft Cloud vs. Global Business Travel | Kingsoft Cloud vs. Alight Inc | Kingsoft Cloud vs. CS Disco LLC |
| Relx PLC vs. Maximus | Relx PLC vs. CBIZ Inc | Relx PLC vs. First Advantage Corp | Relx PLC vs. Network 1 Technologies |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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