Correlation Between Keyware Technologies and Celyad SA
Can any of the company-specific risk be diversified away by investing in both Keyware Technologies and Celyad SA 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 Keyware Technologies and Celyad SA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Keyware Technologies NV and Celyad SA, you can compare the effects of market volatilities on Keyware Technologies and Celyad SA 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 Keyware Technologies with a short position of Celyad SA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keyware Technologies and Celyad SA.
Diversification Opportunities for Keyware Technologies and Celyad SA
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Keyware and Celyad is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Keyware Technologies NV and Celyad SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celyad SA and Keyware Technologies 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 Keyware Technologies NV are associated (or correlated) with Celyad SA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celyad SA has no effect on the direction of Keyware Technologies i.e., Keyware Technologies and Celyad SA go up and down completely randomly.
Pair Corralation between Keyware Technologies and Celyad SA
Assuming the 90 days trading horizon Keyware Technologies NV is expected to under-perform the Celyad SA. But the stock apears to be less risky and, when comparing its historical volatility, Keyware Technologies NV is 18.9 times less risky than Celyad SA. The stock trades about -0.04 of its potential returns per unit of risk. The Celyad SA is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 28.00 in Celyad SA on September 1, 2024 and sell it today you would earn a total of 45.00 from holding Celyad SA or generate 160.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Keyware Technologies NV vs. Celyad SA
Performance |
| Timeline |
| Keyware Technologies |
| Celyad SA |
Keyware Technologies and Celyad SA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Keyware Technologies and Celyad SA
The main advantage of trading using opposite Keyware Technologies and Celyad SA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keyware Technologies position performs unexpectedly, Celyad SA 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 Celyad SA will offset losses from the drop in Celyad SA's long position.| Keyware Technologies vs. Crescent NV | Keyware Technologies vs. Ion Beam Applications | Keyware Technologies vs. Nyrstar NV | Keyware Technologies vs. AGFA Gevaert NV |
| Celyad SA vs. Retail Estates | Celyad SA vs. Shurgard Self Storage | Celyad SA vs. Onward Medical NV | Celyad SA vs. Vastned Retail Belgium |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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