Correlation Between KINGBOARD CHEMICAL and OFFICE DEPOT
Can any of the company-specific risk be diversified away by investing in both KINGBOARD CHEMICAL and OFFICE DEPOT 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 OFFICE DEPOT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KINGBOARD CHEMICAL and OFFICE DEPOT, you can compare the effects of market volatilities on KINGBOARD CHEMICAL and OFFICE DEPOT 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 OFFICE DEPOT. Check out your portfolio center. Please also check ongoing floating volatility patterns of KINGBOARD CHEMICAL and OFFICE DEPOT.
Diversification Opportunities for KINGBOARD CHEMICAL and OFFICE DEPOT
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between KINGBOARD and OFFICE is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding KINGBOARD CHEMICAL and OFFICE DEPOT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on OFFICE DEPOT 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 OFFICE DEPOT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of OFFICE DEPOT has no effect on the direction of KINGBOARD CHEMICAL i.e., KINGBOARD CHEMICAL and OFFICE DEPOT go up and down completely randomly.
Pair Corralation between KINGBOARD CHEMICAL and OFFICE DEPOT
If you would invest 195.00 in KINGBOARD CHEMICAL on October 11, 2024 and sell it today you would earn a total of 35.00 from holding KINGBOARD CHEMICAL or generate 17.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 97.44% |
| Values | Daily Returns |
KINGBOARD CHEMICAL vs. OFFICE DEPOT
Performance |
| Timeline |
| KINGBOARD CHEMICAL |
| OFFICE DEPOT |
KINGBOARD CHEMICAL and OFFICE DEPOT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KINGBOARD CHEMICAL and OFFICE DEPOT
The main advantage of trading using opposite KINGBOARD CHEMICAL and OFFICE DEPOT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KINGBOARD CHEMICAL position performs unexpectedly, OFFICE DEPOT 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 OFFICE DEPOT will offset losses from the drop in OFFICE DEPOT's long position.| KINGBOARD CHEMICAL vs. STMICROELECTRONICS | KINGBOARD CHEMICAL vs. Corporate Office Properties | KINGBOARD CHEMICAL vs. Samsung Electronics Co | KINGBOARD CHEMICAL vs. Benchmark Electronics |
| OFFICE DEPOT vs. Sinopec Shanghai Petrochemical | OFFICE DEPOT vs. SEKISUI CHEMICAL | OFFICE DEPOT vs. Soken Chemical Engineering | OFFICE DEPOT vs. INDO RAMA SYNTHETIC |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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