Correlation Between KGI Securities and AAPICO Hitech
Can any of the company-specific risk be diversified away by investing in both KGI Securities and AAPICO Hitech 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 KGI Securities and AAPICO Hitech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KGI Securities Public and AAPICO Hitech Public, you can compare the effects of market volatilities on KGI Securities and AAPICO Hitech 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 KGI Securities with a short position of AAPICO Hitech. Check out your portfolio center. Please also check ongoing floating volatility patterns of KGI Securities and AAPICO Hitech.
Diversification Opportunities for KGI Securities and AAPICO Hitech
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between KGI and AAPICO is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding KGI Securities Public and AAPICO Hitech Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AAPICO Hitech Public and KGI Securities 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 KGI Securities Public are associated (or correlated) with AAPICO Hitech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AAPICO Hitech Public has no effect on the direction of KGI Securities i.e., KGI Securities and AAPICO Hitech go up and down completely randomly.
Pair Corralation between KGI Securities and AAPICO Hitech
Assuming the 90 days trading horizon KGI Securities Public is expected to generate 0.21 times more return on investment than AAPICO Hitech. However, KGI Securities Public is 4.68 times less risky than AAPICO Hitech. It trades about -0.29 of its potential returns per unit of risk. AAPICO Hitech Public is currently generating about -0.19 per unit of risk. If you would invest 438.00 in KGI Securities Public on August 29, 2024 and sell it today you would lose (16.00) from holding KGI Securities Public or give up 3.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
KGI Securities Public vs. AAPICO Hitech Public
Performance |
| Timeline |
| KGI Securities Public |
| AAPICO Hitech Public |
KGI Securities and AAPICO Hitech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KGI Securities and AAPICO Hitech
The main advantage of trading using opposite KGI Securities and AAPICO Hitech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KGI Securities position performs unexpectedly, AAPICO Hitech 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 AAPICO Hitech will offset losses from the drop in AAPICO Hitech's long position.| KGI Securities vs. AAPICO Hitech Public | KGI Securities vs. Namwiwat Medical | KGI Securities vs. Heng Leasing Capital | KGI Securities vs. INET Leasehold REIT |
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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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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