Correlation Between KLOECKNER and Lion One
Can any of the company-specific risk be diversified away by investing in both KLOECKNER and Lion One 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 KLOECKNER and Lion One into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KLOECKNER N and Lion One Metals, you can compare the effects of market volatilities on KLOECKNER and Lion One 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 KLOECKNER with a short position of Lion One. Check out your portfolio center. Please also check ongoing floating volatility patterns of KLOECKNER and Lion One.
Diversification Opportunities for KLOECKNER and Lion One
Weak diversification
The 3 months correlation between KLOECKNER and Lion is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding KLOECKNER N and Lion One Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lion One Metals and KLOECKNER 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 KLOECKNER N are associated (or correlated) with Lion One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lion One Metals has no effect on the direction of KLOECKNER i.e., KLOECKNER and Lion One go up and down completely randomly.
Pair Corralation between KLOECKNER and Lion One
Assuming the 90 days trading horizon KLOECKNER N is expected to generate 0.4 times more return on investment than Lion One. However, KLOECKNER N is 2.49 times less risky than Lion One. It trades about -0.05 of its potential returns per unit of risk. Lion One Metals is currently generating about -0.02 per unit of risk. If you would invest 824.00 in KLOECKNER N on August 28, 2024 and sell it today you would lose (348.00) from holding KLOECKNER N or give up 42.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KLOECKNER N vs. Lion One Metals
Performance |
| Timeline |
| KLOECKNER N |
| Lion One Metals |
KLOECKNER and Lion One Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KLOECKNER and Lion One
The main advantage of trading using opposite KLOECKNER and Lion One positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KLOECKNER position performs unexpectedly, Lion One 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 Lion One will offset losses from the drop in Lion One's long position.| KLOECKNER vs. ON SEMICONDUCTOR | KLOECKNER vs. ELMOS SEMICONDUCTOR | KLOECKNER vs. Taiwan Semiconductor Manufacturing | KLOECKNER vs. CHIBA BANK |
| Lion One vs. Franco Nevada | Lion One vs. Agnico Eagle Mines | Lion One vs. Superior Plus Corp | Lion One vs. NMI Holdings |
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 Stocks Directory module to find actively traded stocks across global markets.
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