Correlation Between Kinepolis Group and Home Invest
Can any of the company-specific risk be diversified away by investing in both Kinepolis Group and Home Invest 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 Kinepolis Group and Home Invest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinepolis Group NV and Home Invest Belgium, you can compare the effects of market volatilities on Kinepolis Group and Home Invest 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 Kinepolis Group with a short position of Home Invest. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinepolis Group and Home Invest.
Diversification Opportunities for Kinepolis Group and Home Invest
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kinepolis and Home is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Kinepolis Group NV and Home Invest Belgium in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Home Invest Belgium and Kinepolis Group 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 Kinepolis Group NV are associated (or correlated) with Home Invest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Home Invest Belgium has no effect on the direction of Kinepolis Group i.e., Kinepolis Group and Home Invest go up and down completely randomly.
Pair Corralation between Kinepolis Group and Home Invest
Assuming the 90 days trading horizon Kinepolis Group NV is expected to generate 0.92 times more return on investment than Home Invest. However, Kinepolis Group NV is 1.09 times less risky than Home Invest. It trades about 0.01 of its potential returns per unit of risk. Home Invest Belgium is currently generating about -0.02 per unit of risk. If you would invest 3,774 in Kinepolis Group NV on September 2, 2024 and sell it today you would lose (94.00) from holding Kinepolis Group NV or give up 2.49% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinepolis Group NV vs. Home Invest Belgium
Performance |
| Timeline |
| Kinepolis Group NV |
| Home Invest Belgium |
Kinepolis Group and Home Invest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinepolis Group and Home Invest
The main advantage of trading using opposite Kinepolis Group and Home Invest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinepolis Group position performs unexpectedly, Home Invest 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 Home Invest will offset losses from the drop in Home Invest's long position.| Kinepolis Group vs. Onward Medical NV | Kinepolis Group vs. Retail Estates | Kinepolis Group vs. Ion Beam Applications | Kinepolis Group vs. Vastned Retail Belgium |
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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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