Correlation Between Kuehne Nagel and Royal Mail
Can any of the company-specific risk be diversified away by investing in both Kuehne Nagel and Royal Mail 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 Kuehne Nagel and Royal Mail into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kuehne Nagel International and Royal Mail PLC, you can compare the effects of market volatilities on Kuehne Nagel and Royal Mail 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 Kuehne Nagel with a short position of Royal Mail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kuehne Nagel and Royal Mail.
Diversification Opportunities for Kuehne Nagel and Royal Mail
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kuehne and Royal is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Kuehne Nagel International and Royal Mail PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Royal Mail PLC and Kuehne Nagel 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 Kuehne Nagel International are associated (or correlated) with Royal Mail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Royal Mail PLC has no effect on the direction of Kuehne Nagel i.e., Kuehne Nagel and Royal Mail go up and down completely randomly.
Pair Corralation between Kuehne Nagel and Royal Mail
Assuming the 90 days horizon Kuehne Nagel International is expected to under-perform the Royal Mail. But the pink sheet apears to be less risky and, when comparing its historical volatility, Kuehne Nagel International is 1.47 times less risky than Royal Mail. The pink sheet trades about -0.02 of its potential returns per unit of risk. The Royal Mail PLC is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 587.00 in Royal Mail PLC on October 25, 2024 and sell it today you would earn a total of 302.00 from holding Royal Mail PLC or generate 51.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kuehne Nagel International vs. Royal Mail PLC
Performance |
| Timeline |
| Kuehne Nagel Interna |
| Royal Mail PLC |
Kuehne Nagel and Royal Mail Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kuehne Nagel and Royal Mail
The main advantage of trading using opposite Kuehne Nagel and Royal Mail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kuehne Nagel position performs unexpectedly, Royal Mail 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 Royal Mail will offset losses from the drop in Royal Mail's long position.| Kuehne Nagel vs. DSV Panalpina AS | Kuehne Nagel vs. United Parcel Service | Kuehne Nagel vs. Kuehne Nagel International | Kuehne Nagel vs. DSV Panalpina AS |
| Royal Mail vs. FedEx | Royal Mail vs. United Parcel Service | Royal Mail vs. Freightos Limited Ordinary | Royal Mail vs. Addentax Group Corp |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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