Correlation Between Kjell Group and Precise Biometrics
Can any of the company-specific risk be diversified away by investing in both Kjell Group and Precise Biometrics 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 Kjell Group and Precise Biometrics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kjell Group AB and Precise Biometrics AB, you can compare the effects of market volatilities on Kjell Group and Precise Biometrics 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 Kjell Group with a short position of Precise Biometrics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kjell Group and Precise Biometrics.
Diversification Opportunities for Kjell Group and Precise Biometrics
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kjell and Precise is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Kjell Group AB and Precise Biometrics AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Precise Biometrics and Kjell 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 Kjell Group AB are associated (or correlated) with Precise Biometrics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Precise Biometrics has no effect on the direction of Kjell Group i.e., Kjell Group and Precise Biometrics go up and down completely randomly.
Pair Corralation between Kjell Group and Precise Biometrics
Assuming the 90 days trading horizon Kjell Group AB is expected to under-perform the Precise Biometrics. But the stock apears to be less risky and, when comparing its historical volatility, Kjell Group AB is 2.14 times less risky than Precise Biometrics. The stock trades about -0.03 of its potential returns per unit of risk. The Precise Biometrics AB is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 120.00 in Precise Biometrics AB on September 1, 2024 and sell it today you would earn a total of 466.00 from holding Precise Biometrics AB or generate 388.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kjell Group AB vs. Precise Biometrics AB
Performance |
| Timeline |
| Kjell Group AB |
| Precise Biometrics |
Kjell Group and Precise Biometrics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kjell Group and Precise Biometrics
The main advantage of trading using opposite Kjell Group and Precise Biometrics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kjell Group position performs unexpectedly, Precise Biometrics 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 Precise Biometrics will offset losses from the drop in Precise Biometrics' long position.| Kjell Group vs. Clas Ohlson AB | Kjell Group vs. Ctek AB | Kjell Group vs. Truecaller AB | Kjell Group vs. Dustin Group AB |
| Precise Biometrics vs. Enea AB | Precise Biometrics vs. Novotek AB | Precise Biometrics vs. Addnode Group AB | Precise Biometrics vs. Softronic 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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