Correlation Between Kaltura and GEN Restaurant
Can any of the company-specific risk be diversified away by investing in both Kaltura and GEN Restaurant 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 Kaltura and GEN Restaurant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kaltura and GEN Restaurant Group,, you can compare the effects of market volatilities on Kaltura and GEN Restaurant 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 Kaltura with a short position of GEN Restaurant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaltura and GEN Restaurant.
Diversification Opportunities for Kaltura and GEN Restaurant
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Kaltura and GEN is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Kaltura and GEN Restaurant Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GEN Restaurant Group, and Kaltura 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 Kaltura are associated (or correlated) with GEN Restaurant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GEN Restaurant Group, has no effect on the direction of Kaltura i.e., Kaltura and GEN Restaurant go up and down completely randomly.
Pair Corralation between Kaltura and GEN Restaurant
Given the investment horizon of 90 days Kaltura is expected to generate 1.1 times more return on investment than GEN Restaurant. However, Kaltura is 1.1 times more volatile than GEN Restaurant Group,. It trades about 0.43 of its potential returns per unit of risk. GEN Restaurant Group, is currently generating about -0.07 per unit of risk. If you would invest 131.00 in Kaltura on August 29, 2024 and sell it today you would earn a total of 86.00 from holding Kaltura or generate 65.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kaltura vs. GEN Restaurant Group,
Performance |
| Timeline |
| Kaltura |
| GEN Restaurant Group, |
Kaltura and GEN Restaurant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kaltura and GEN Restaurant
The main advantage of trading using opposite Kaltura and GEN Restaurant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaltura position performs unexpectedly, GEN Restaurant 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 GEN Restaurant will offset losses from the drop in GEN Restaurant's long position.The idea behind Kaltura and GEN Restaurant Group, pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| GEN Restaurant vs. Cebu Air ADR | GEN Restaurant vs. ArcelorMittal SA ADR | GEN Restaurant vs. Grupo Simec SAB | GEN Restaurant vs. Corporacion America Airports |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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