Correlation Between Kongsberg Gruppen and Huddlestock Fintech
Can any of the company-specific risk be diversified away by investing in both Kongsberg Gruppen and Huddlestock Fintech 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 Kongsberg Gruppen and Huddlestock Fintech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kongsberg Gruppen ASA and Huddlestock Fintech As, you can compare the effects of market volatilities on Kongsberg Gruppen and Huddlestock Fintech 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 Kongsberg Gruppen with a short position of Huddlestock Fintech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kongsberg Gruppen and Huddlestock Fintech.
Diversification Opportunities for Kongsberg Gruppen and Huddlestock Fintech
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kongsberg and Huddlestock is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Kongsberg Gruppen ASA and Huddlestock Fintech As in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huddlestock Fintech and Kongsberg Gruppen 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 Kongsberg Gruppen ASA are associated (or correlated) with Huddlestock Fintech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huddlestock Fintech has no effect on the direction of Kongsberg Gruppen i.e., Kongsberg Gruppen and Huddlestock Fintech go up and down completely randomly.
Pair Corralation between Kongsberg Gruppen and Huddlestock Fintech
Assuming the 90 days trading horizon Kongsberg Gruppen is expected to generate 3.5 times less return on investment than Huddlestock Fintech. But when comparing it to its historical volatility, Kongsberg Gruppen ASA is 4.67 times less risky than Huddlestock Fintech. It trades about 0.16 of its potential returns per unit of risk. Huddlestock Fintech As is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 45.00 in Huddlestock Fintech As on September 15, 2024 and sell it today you would earn a total of 7.00 from holding Huddlestock Fintech As or generate 15.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kongsberg Gruppen ASA vs. Huddlestock Fintech As
Performance |
| Timeline |
| Kongsberg Gruppen ASA |
| Huddlestock Fintech |
Kongsberg Gruppen and Huddlestock Fintech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kongsberg Gruppen and Huddlestock Fintech
The main advantage of trading using opposite Kongsberg Gruppen and Huddlestock Fintech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kongsberg Gruppen position performs unexpectedly, Huddlestock Fintech 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 Huddlestock Fintech will offset losses from the drop in Huddlestock Fintech's long position.| Kongsberg Gruppen vs. DnB ASA | Kongsberg Gruppen vs. Orkla ASA | Kongsberg Gruppen vs. Storebrand ASA | Kongsberg Gruppen vs. Yara International ASA |
| Huddlestock Fintech vs. Pexip Holding ASA | Huddlestock Fintech vs. Kongsberg Gruppen ASA | Huddlestock Fintech vs. Napatech AS | Huddlestock Fintech vs. Elkem ASA |
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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