Correlation Between Kingstone Companies and Wilhelmina
Can any of the company-specific risk be diversified away by investing in both Kingstone Companies and Wilhelmina 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 Kingstone Companies and Wilhelmina into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kingstone Companies and Wilhelmina, you can compare the effects of market volatilities on Kingstone Companies and Wilhelmina 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 Kingstone Companies with a short position of Wilhelmina. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kingstone Companies and Wilhelmina.
Diversification Opportunities for Kingstone Companies and Wilhelmina
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kingstone and Wilhelmina is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Kingstone Companies and Wilhelmina in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wilhelmina and Kingstone Companies 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 Kingstone Companies are associated (or correlated) with Wilhelmina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wilhelmina has no effect on the direction of Kingstone Companies i.e., Kingstone Companies and Wilhelmina go up and down completely randomly.
Pair Corralation between Kingstone Companies and Wilhelmina
Given the investment horizon of 90 days Kingstone Companies is expected to generate 1.86 times more return on investment than Wilhelmina. However, Kingstone Companies is 1.86 times more volatile than Wilhelmina. It trades about 0.45 of its potential returns per unit of risk. Wilhelmina is currently generating about 0.31 per unit of risk. If you would invest 973.00 in Kingstone Companies on August 29, 2024 and sell it today you would earn a total of 623.00 from holding Kingstone Companies or generate 64.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kingstone Companies vs. Wilhelmina
Performance |
| Timeline |
| Kingstone Companies |
| Wilhelmina |
Kingstone Companies and Wilhelmina Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kingstone Companies and Wilhelmina
The main advantage of trading using opposite Kingstone Companies and Wilhelmina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kingstone Companies position performs unexpectedly, Wilhelmina 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 Wilhelmina will offset losses from the drop in Wilhelmina's long position.| Kingstone Companies vs. HCI Group | Kingstone Companies vs. Universal Insurance Holdings | Kingstone Companies vs. Horace Mann Educators | Kingstone Companies vs. Heritage Insurance Hldgs |
| Wilhelmina vs. Performant Financial | Wilhelmina vs. Network 1 Technologies | Wilhelmina vs. Rentokil Initial PLC | Wilhelmina vs. Mader Group Limited |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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