Correlation Between Kiliaro AB and ALM Equity
Can any of the company-specific risk be diversified away by investing in both Kiliaro AB and ALM Equity 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 Kiliaro AB and ALM Equity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kiliaro AB and ALM Equity AB, you can compare the effects of market volatilities on Kiliaro AB and ALM Equity 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 Kiliaro AB with a short position of ALM Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kiliaro AB and ALM Equity.
Diversification Opportunities for Kiliaro AB and ALM Equity
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kiliaro and ALM is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Kiliaro AB and ALM Equity AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALM Equity AB and Kiliaro AB 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 Kiliaro AB are associated (or correlated) with ALM Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALM Equity AB has no effect on the direction of Kiliaro AB i.e., Kiliaro AB and ALM Equity go up and down completely randomly.
Pair Corralation between Kiliaro AB and ALM Equity
Assuming the 90 days trading horizon Kiliaro AB is expected to generate 5.84 times more return on investment than ALM Equity. However, Kiliaro AB is 5.84 times more volatile than ALM Equity AB. It trades about 0.03 of its potential returns per unit of risk. ALM Equity AB is currently generating about -0.39 per unit of risk. If you would invest 26.00 in Kiliaro AB on September 2, 2024 and sell it today you would lose (1.00) from holding Kiliaro AB or give up 3.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kiliaro AB vs. ALM Equity AB
Performance |
| Timeline |
| Kiliaro AB |
| ALM Equity AB |
Kiliaro AB and ALM Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kiliaro AB and ALM Equity
The main advantage of trading using opposite Kiliaro AB and ALM Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kiliaro AB position performs unexpectedly, ALM Equity 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 ALM Equity will offset losses from the drop in ALM Equity's long position.| Kiliaro AB vs. Lipigon Pharmaceuticals AB | Kiliaro AB vs. Ekobot AB | Kiliaro AB vs. iZafe Group AB | Kiliaro AB vs. ALM Equity AB |
| ALM Equity vs. FastPartner AB | ALM Equity vs. Svolder AB | ALM Equity vs. Fastighets AB Balder | ALM Equity vs. Cibus Nordic Real |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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