Correlation Between KASPIKZ 1 and SILEON AB
Can any of the company-specific risk be diversified away by investing in both KASPIKZ 1 and SILEON AB 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 KASPIKZ 1 and SILEON AB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KASPIKZ 1 and SILEON AB ON, you can compare the effects of market volatilities on KASPIKZ 1 and SILEON AB 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 KASPIKZ 1 with a short position of SILEON AB. Check out your portfolio center. Please also check ongoing floating volatility patterns of KASPIKZ 1 and SILEON AB.
Diversification Opportunities for KASPIKZ 1 and SILEON AB
Significant diversification
The 3 months correlation between KASPIKZ and SILEON is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding KASPIKZ 1 and SILEON AB ON in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SILEON AB ON and KASPIKZ 1 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 KASPIKZ 1 are associated (or correlated) with SILEON AB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SILEON AB ON has no effect on the direction of KASPIKZ 1 i.e., KASPIKZ 1 and SILEON AB go up and down completely randomly.
Pair Corralation between KASPIKZ 1 and SILEON AB
Assuming the 90 days horizon KASPIKZ 1 is expected to under-perform the SILEON AB. But the stock apears to be less risky and, when comparing its historical volatility, KASPIKZ 1 is 144.81 times less risky than SILEON AB. The stock trades about -0.02 of its potential returns per unit of risk. The SILEON AB ON is currently generating about 0.4 of returns per unit of risk over similar time horizon. If you would invest 200.00 in SILEON AB ON on October 14, 2024 and sell it today you would lose (164.00) from holding SILEON AB ON or give up 82.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.47% |
| Values | Daily Returns |
KASPIKZ 1 vs. SILEON AB ON
Performance |
| Timeline |
| KASPIKZ 1 |
| SILEON AB ON |
KASPIKZ 1 and SILEON AB Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KASPIKZ 1 and SILEON AB
The main advantage of trading using opposite KASPIKZ 1 and SILEON AB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KASPIKZ 1 position performs unexpectedly, SILEON AB 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 SILEON AB will offset losses from the drop in SILEON AB's long position.| KASPIKZ 1 vs. Sibanye Stillwater Limited | KASPIKZ 1 vs. Impala Platinum Holdings | KASPIKZ 1 vs. Cellink AB | KASPIKZ 1 vs. Mowi ASA |
| SILEON AB vs. Microsoft | SILEON AB vs. CrowdStrike Holdings | SILEON AB vs. KASPIKZ 1 | SILEON AB vs. Superior Plus Corp |
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 Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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