Correlation Between KS AG and ICL Israel
Can any of the company-specific risk be diversified away by investing in both KS AG and ICL Israel 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 KS AG and ICL Israel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KS AG DRC and ICL Israel Chemicals, you can compare the effects of market volatilities on KS AG and ICL Israel 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 KS AG with a short position of ICL Israel. Check out your portfolio center. Please also check ongoing floating volatility patterns of KS AG and ICL Israel.
Diversification Opportunities for KS AG and ICL Israel
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between KPLUY and ICL is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding KS AG DRC and ICL Israel Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ICL Israel Chemicals and KS AG 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 KS AG DRC are associated (or correlated) with ICL Israel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ICL Israel Chemicals has no effect on the direction of KS AG i.e., KS AG and ICL Israel go up and down completely randomly.
Pair Corralation between KS AG and ICL Israel
Assuming the 90 days horizon KS AG DRC is expected to generate 1.85 times more return on investment than ICL Israel. However, KS AG is 1.85 times more volatile than ICL Israel Chemicals. It trades about 0.0 of its potential returns per unit of risk. ICL Israel Chemicals is currently generating about -0.03 per unit of risk. If you would invest 903.00 in KS AG DRC on September 3, 2024 and sell it today you would lose (318.00) from holding KS AG DRC or give up 35.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 98.18% |
| Values | Daily Returns |
KS AG DRC vs. ICL Israel Chemicals
Performance |
| Timeline |
| KS AG DRC |
| ICL Israel Chemicals |
KS AG and ICL Israel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KS AG and ICL Israel
The main advantage of trading using opposite KS AG and ICL Israel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KS AG position performs unexpectedly, ICL Israel 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 ICL Israel will offset losses from the drop in ICL Israel's long position.| KS AG vs. Yara International ASA | KS AG vs. Boswell J G | KS AG vs. ICL Israel Chemicals | KS AG vs. CF Industries Holdings |
| ICL Israel vs. CF Industries Holdings | ICL Israel vs. The Mosaic | ICL Israel vs. American Vanguard | ICL Israel vs. CVR Partners LP |
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 Stocks Directory module to find actively traded stocks across global markets.
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