Correlation Between KLDiscovery and SAP SE
Can any of the company-specific risk be diversified away by investing in both KLDiscovery and SAP SE 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 KLDiscovery and SAP SE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KLDiscovery and SAP SE, you can compare the effects of market volatilities on KLDiscovery and SAP SE 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 KLDiscovery with a short position of SAP SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of KLDiscovery and SAP SE.
Diversification Opportunities for KLDiscovery and SAP SE
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between KLDiscovery and SAP is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding KLDiscovery and SAP SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAP SE and KLDiscovery 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 KLDiscovery are associated (or correlated) with SAP SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAP SE has no effect on the direction of KLDiscovery i.e., KLDiscovery and SAP SE go up and down completely randomly.
Pair Corralation between KLDiscovery and SAP SE
If you would invest 23,124 in SAP SE on September 13, 2024 and sell it today you would earn a total of 1,686 from holding SAP SE or generate 7.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.76% |
| Values | Daily Returns |
KLDiscovery vs. SAP SE
Performance |
| Timeline |
| KLDiscovery |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| SAP SE |
KLDiscovery and SAP SE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KLDiscovery and SAP SE
The main advantage of trading using opposite KLDiscovery and SAP SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KLDiscovery position performs unexpectedly, SAP SE 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 SAP SE will offset losses from the drop in SAP SE's long position.| KLDiscovery vs. 01 Communique Laboratory | KLDiscovery vs. LifeSpeak | KLDiscovery vs. RESAAS Services | KLDiscovery vs. RenoWorks Software |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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