Correlation Between Kip McGrath and Johns Lyng
Can any of the company-specific risk be diversified away by investing in both Kip McGrath and Johns Lyng 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 Kip McGrath and Johns Lyng into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kip McGrath Education and Johns Lyng Group, you can compare the effects of market volatilities on Kip McGrath and Johns Lyng 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 Kip McGrath with a short position of Johns Lyng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kip McGrath and Johns Lyng.
Diversification Opportunities for Kip McGrath and Johns Lyng
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kip and Johns is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Kip McGrath Education and Johns Lyng Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Johns Lyng Group and Kip McGrath 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 Kip McGrath Education are associated (or correlated) with Johns Lyng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Johns Lyng Group has no effect on the direction of Kip McGrath i.e., Kip McGrath and Johns Lyng go up and down completely randomly.
Pair Corralation between Kip McGrath and Johns Lyng
Assuming the 90 days trading horizon Kip McGrath Education is expected to generate 1.22 times more return on investment than Johns Lyng. However, Kip McGrath is 1.22 times more volatile than Johns Lyng Group. It trades about 0.29 of its potential returns per unit of risk. Johns Lyng Group is currently generating about 0.24 per unit of risk. If you would invest 43.00 in Kip McGrath Education on September 4, 2024 and sell it today you would earn a total of 7.00 from holding Kip McGrath Education or generate 16.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kip McGrath Education vs. Johns Lyng Group
Performance |
| Timeline |
| Kip McGrath Education |
| Johns Lyng Group |
Kip McGrath and Johns Lyng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kip McGrath and Johns Lyng
The main advantage of trading using opposite Kip McGrath and Johns Lyng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kip McGrath position performs unexpectedly, Johns Lyng 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 Johns Lyng will offset losses from the drop in Johns Lyng's long position.| Kip McGrath vs. National Australia Bank | Kip McGrath vs. National Australia Bank | Kip McGrath vs. Westpac Banking | Kip McGrath vs. National Australia Bank |
| Johns Lyng vs. Clime Investment Management | Johns Lyng vs. Ramsay Health Care | Johns Lyng vs. Thorney Technologies | Johns Lyng vs. Macquarie Technology Group |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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