Correlation Between KINGBOARD CHEMICAL and MT Bank
Can any of the company-specific risk be diversified away by investing in both KINGBOARD CHEMICAL and MT Bank 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 KINGBOARD CHEMICAL and MT Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KINGBOARD CHEMICAL and MT Bank Corp, you can compare the effects of market volatilities on KINGBOARD CHEMICAL and MT Bank 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 KINGBOARD CHEMICAL with a short position of MT Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of KINGBOARD CHEMICAL and MT Bank.
Diversification Opportunities for KINGBOARD CHEMICAL and MT Bank
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between KINGBOARD and MTZ is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding KINGBOARD CHEMICAL and MT Bank Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MT Bank Corp and KINGBOARD CHEMICAL 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 KINGBOARD CHEMICAL are associated (or correlated) with MT Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MT Bank Corp has no effect on the direction of KINGBOARD CHEMICAL i.e., KINGBOARD CHEMICAL and MT Bank go up and down completely randomly.
Pair Corralation between KINGBOARD CHEMICAL and MT Bank
Assuming the 90 days trading horizon KINGBOARD CHEMICAL is expected to generate 1.84 times more return on investment than MT Bank. However, KINGBOARD CHEMICAL is 1.84 times more volatile than MT Bank Corp. It trades about 0.05 of its potential returns per unit of risk. MT Bank Corp is currently generating about 0.05 per unit of risk. If you would invest 136.00 in KINGBOARD CHEMICAL on September 13, 2024 and sell it today you would earn a total of 104.00 from holding KINGBOARD CHEMICAL or generate 76.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
KINGBOARD CHEMICAL vs. MT Bank Corp
Performance |
| Timeline |
| KINGBOARD CHEMICAL |
| MT Bank Corp |
KINGBOARD CHEMICAL and MT Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KINGBOARD CHEMICAL and MT Bank
The main advantage of trading using opposite KINGBOARD CHEMICAL and MT Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KINGBOARD CHEMICAL position performs unexpectedly, MT Bank 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 MT Bank will offset losses from the drop in MT Bank's long position.| KINGBOARD CHEMICAL vs. CENTURIA OFFICE REIT | KINGBOARD CHEMICAL vs. Cogent Communications Holdings | KINGBOARD CHEMICAL vs. INVITATION HOMES DL | KINGBOARD CHEMICAL vs. Aedas Homes SA |
| MT Bank vs. KINGBOARD CHEMICAL | MT Bank vs. CHEMICAL INDUSTRIES | MT Bank vs. SEKISUI CHEMICAL | MT Bank vs. X FAB Silicon Foundries |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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