Correlation Between Konami Holdings and SohuCom
Can any of the company-specific risk be diversified away by investing in both Konami Holdings and SohuCom 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 Konami Holdings and SohuCom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Konami Holdings and SohuCom, you can compare the effects of market volatilities on Konami Holdings and SohuCom 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 Konami Holdings with a short position of SohuCom. Check out your portfolio center. Please also check ongoing floating volatility patterns of Konami Holdings and SohuCom.
Diversification Opportunities for Konami Holdings and SohuCom
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Konami and SohuCom is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Konami Holdings and SohuCom in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SohuCom and Konami Holdings 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 Konami Holdings are associated (or correlated) with SohuCom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SohuCom has no effect on the direction of Konami Holdings i.e., Konami Holdings and SohuCom go up and down completely randomly.
Pair Corralation between Konami Holdings and SohuCom
Assuming the 90 days horizon Konami Holdings is expected to generate 0.48 times more return on investment than SohuCom. However, Konami Holdings is 2.07 times less risky than SohuCom. It trades about -0.02 of its potential returns per unit of risk. SohuCom is currently generating about -0.05 per unit of risk. If you would invest 4,742 in Konami Holdings on October 22, 2024 and sell it today you would lose (21.00) from holding Konami Holdings or give up 0.44% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Konami Holdings vs. SohuCom
Performance |
| Timeline |
| Konami Holdings |
| SohuCom |
Konami Holdings and SohuCom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Konami Holdings and SohuCom
The main advantage of trading using opposite Konami Holdings and SohuCom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Konami Holdings position performs unexpectedly, SohuCom 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 SohuCom will offset losses from the drop in SohuCom's long position.| Konami Holdings vs. NEXON Co | Konami Holdings vs. Sega Sammy Holdings | Konami Holdings vs. Capcom Co Ltd | Konami Holdings vs. CD Projekt SA |
| SohuCom vs. Snail, Class A | SohuCom vs. Playstudios | SohuCom vs. Playtika Holding Corp | SohuCom vs. Doubledown Interactive Co |
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 CEOs Directory module to screen CEOs from public companies around the world.
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