Correlation Between Kongsberg Gruppen and Klaveness Combination
Can any of the company-specific risk be diversified away by investing in both Kongsberg Gruppen and Klaveness Combination 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 Klaveness Combination 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 Klaveness Combination Carriers, you can compare the effects of market volatilities on Kongsberg Gruppen and Klaveness Combination 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 Klaveness Combination. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kongsberg Gruppen and Klaveness Combination.
Diversification Opportunities for Kongsberg Gruppen and Klaveness Combination
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kongsberg and Klaveness is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Kongsberg Gruppen ASA and Klaveness Combination Carriers in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Klaveness Combination 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 Klaveness Combination. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Klaveness Combination has no effect on the direction of Kongsberg Gruppen i.e., Kongsberg Gruppen and Klaveness Combination go up and down completely randomly.
Pair Corralation between Kongsberg Gruppen and Klaveness Combination
Assuming the 90 days trading horizon Kongsberg Gruppen ASA is expected to generate 0.83 times more return on investment than Klaveness Combination. However, Kongsberg Gruppen ASA is 1.2 times less risky than Klaveness Combination. It trades about 0.42 of its potential returns per unit of risk. Klaveness Combination Carriers is currently generating about -0.02 per unit of risk. If you would invest 111,100 in Kongsberg Gruppen ASA on September 3, 2024 and sell it today you would earn a total of 18,800 from holding Kongsberg Gruppen ASA or generate 16.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kongsberg Gruppen ASA vs. Klaveness Combination Carriers
Performance |
| Timeline |
| Kongsberg Gruppen ASA |
| Klaveness Combination |
Kongsberg Gruppen and Klaveness Combination Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kongsberg Gruppen and Klaveness Combination
The main advantage of trading using opposite Kongsberg Gruppen and Klaveness Combination positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kongsberg Gruppen position performs unexpectedly, Klaveness Combination 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 Klaveness Combination will offset losses from the drop in Klaveness Combination's long position.| Kongsberg Gruppen vs. DnB ASA | Kongsberg Gruppen vs. Orkla ASA | Kongsberg Gruppen vs. Storebrand ASA | Kongsberg Gruppen vs. Yara International ASA |
| Klaveness Combination vs. Grong Sparebank | Klaveness Combination vs. Awilco Drilling PLC | Klaveness Combination vs. Lea Bank ASA | Klaveness Combination vs. Polaris Media |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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