Correlation Between KEBNI AB and X Fab
Can any of the company-specific risk be diversified away by investing in both KEBNI AB and X Fab 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 KEBNI AB and X Fab into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KEBNI AB SERB and X Fab Silicon, you can compare the effects of market volatilities on KEBNI AB and X Fab 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 KEBNI AB with a short position of X Fab. Check out your portfolio center. Please also check ongoing floating volatility patterns of KEBNI AB and X Fab.
Diversification Opportunities for KEBNI AB and X Fab
Very poor diversification
The 3 months correlation between KEBNI and XFB is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding KEBNI AB SERB and X Fab Silicon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on X Fab Silicon and KEBNI AB 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 KEBNI AB SERB are associated (or correlated) with X Fab. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of X Fab Silicon has no effect on the direction of KEBNI AB i.e., KEBNI AB and X Fab go up and down completely randomly.
Pair Corralation between KEBNI AB and X Fab
Assuming the 90 days horizon KEBNI AB SERB is expected to under-perform the X Fab. In addition to that, KEBNI AB is 1.44 times more volatile than X Fab Silicon. It trades about -0.13 of its total potential returns per unit of risk. X Fab Silicon is currently generating about 0.0 per unit of volatility. If you would invest 420.00 in X Fab Silicon on August 31, 2024 and sell it today you would lose (2.00) from holding X Fab Silicon or give up 0.48% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
KEBNI AB SERB vs. X Fab Silicon
Performance |
| Timeline |
| KEBNI AB SERB |
| X Fab Silicon |
KEBNI AB and X Fab Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KEBNI AB and X Fab
The main advantage of trading using opposite KEBNI AB and X Fab positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KEBNI AB position performs unexpectedly, X Fab 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 X Fab will offset losses from the drop in X Fab's long position.| KEBNI AB vs. SMA Solar Technology | KEBNI AB vs. X Fab Silicon | KEBNI AB vs. Chesapeake Utilities | KEBNI AB vs. Hyster Yale Materials Handling |
| X Fab vs. NVIDIA | X Fab vs. Taiwan Semiconductor Manufacturing | X Fab vs. Advanced Micro Devices | X Fab vs. Intel |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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