Correlation Between Kinsale Capital and Infosys
Can any of the company-specific risk be diversified away by investing in both Kinsale Capital and Infosys 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 Kinsale Capital and Infosys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinsale Capital Group and Infosys Ltd ADR, you can compare the effects of market volatilities on Kinsale Capital and Infosys 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 Kinsale Capital with a short position of Infosys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinsale Capital and Infosys.
Diversification Opportunities for Kinsale Capital and Infosys
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kinsale and Infosys is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Kinsale Capital Group and Infosys Ltd ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Infosys Ltd ADR and Kinsale Capital 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 Kinsale Capital Group are associated (or correlated) with Infosys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Infosys Ltd ADR has no effect on the direction of Kinsale Capital i.e., Kinsale Capital and Infosys go up and down completely randomly.
Pair Corralation between Kinsale Capital and Infosys
Given the investment horizon of 90 days Kinsale Capital Group is expected to generate 1.32 times more return on investment than Infosys. However, Kinsale Capital is 1.32 times more volatile than Infosys Ltd ADR. It trades about 0.19 of its potential returns per unit of risk. Infosys Ltd ADR is currently generating about 0.2 per unit of risk. If you would invest 47,606 in Kinsale Capital Group on September 12, 2024 and sell it today you would earn a total of 3,581 from holding Kinsale Capital Group or generate 7.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinsale Capital Group vs. Infosys Ltd ADR
Performance |
| Timeline |
| Kinsale Capital Group |
| Infosys Ltd ADR |
Kinsale Capital and Infosys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinsale Capital and Infosys
The main advantage of trading using opposite Kinsale Capital and Infosys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinsale Capital position performs unexpectedly, Infosys 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 Infosys will offset losses from the drop in Infosys' long position.| Kinsale Capital vs. Aeye Inc | Kinsale Capital vs. Ep Emerging Markets | Kinsale Capital vs. LiCycle Holdings Corp | Kinsale Capital vs. SEI Investments |
| Infosys vs. Cognizant Technology Solutions | Infosys vs. WNS Holdings | Infosys vs. CLARIVATE PLC | Infosys vs. Gartner |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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