Correlation Between Kinnevik Investment and AcadeMedia
Can any of the company-specific risk be diversified away by investing in both Kinnevik Investment and AcadeMedia 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 Kinnevik Investment and AcadeMedia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinnevik Investment AB and AcadeMedia AB, you can compare the effects of market volatilities on Kinnevik Investment and AcadeMedia 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 Kinnevik Investment with a short position of AcadeMedia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinnevik Investment and AcadeMedia.
Diversification Opportunities for Kinnevik Investment and AcadeMedia
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kinnevik and AcadeMedia is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Kinnevik Investment AB and AcadeMedia AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AcadeMedia AB and Kinnevik Investment 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 Kinnevik Investment AB are associated (or correlated) with AcadeMedia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AcadeMedia AB has no effect on the direction of Kinnevik Investment i.e., Kinnevik Investment and AcadeMedia go up and down completely randomly.
Pair Corralation between Kinnevik Investment and AcadeMedia
Assuming the 90 days trading horizon Kinnevik Investment AB is expected to under-perform the AcadeMedia. In addition to that, Kinnevik Investment is 1.62 times more volatile than AcadeMedia AB. It trades about -0.04 of its total potential returns per unit of risk. AcadeMedia AB is currently generating about 0.06 per unit of volatility. If you would invest 4,059 in AcadeMedia AB on August 29, 2024 and sell it today you would earn a total of 2,051 from holding AcadeMedia AB or generate 50.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinnevik Investment AB vs. AcadeMedia AB
Performance |
| Timeline |
| Kinnevik Investment |
| AcadeMedia AB |
Kinnevik Investment and AcadeMedia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinnevik Investment and AcadeMedia
The main advantage of trading using opposite Kinnevik Investment and AcadeMedia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinnevik Investment position performs unexpectedly, AcadeMedia 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 AcadeMedia will offset losses from the drop in AcadeMedia's long position.| Kinnevik Investment vs. Investor AB ser | Kinnevik Investment vs. Investment AB Latour | Kinnevik Investment vs. Industrivarden AB ser | Kinnevik Investment vs. Tele2 AB |
| AcadeMedia vs. Inwido AB | AcadeMedia vs. Alimak Hek Group | AcadeMedia vs. Dometic Group AB | AcadeMedia vs. Byggmax Group AB |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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