Correlation Between Koninklijke KPN and Aegon NV
Can any of the company-specific risk be diversified away by investing in both Koninklijke KPN and Aegon NV 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 Koninklijke KPN and Aegon NV into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koninklijke KPN NV and Aegon NV, you can compare the effects of market volatilities on Koninklijke KPN and Aegon NV 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 Koninklijke KPN with a short position of Aegon NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koninklijke KPN and Aegon NV.
Diversification Opportunities for Koninklijke KPN and Aegon NV
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Koninklijke and Aegon is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Koninklijke KPN NV and Aegon NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aegon NV and Koninklijke KPN 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 Koninklijke KPN NV are associated (or correlated) with Aegon NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aegon NV has no effect on the direction of Koninklijke KPN i.e., Koninklijke KPN and Aegon NV go up and down completely randomly.
Pair Corralation between Koninklijke KPN and Aegon NV
Assuming the 90 days trading horizon Koninklijke KPN NV is expected to under-perform the Aegon NV. In addition to that, Koninklijke KPN is 1.24 times more volatile than Aegon NV. It trades about -0.07 of its total potential returns per unit of risk. Aegon NV is currently generating about 0.46 per unit of volatility. If you would invest 581.00 in Aegon NV on November 3, 2024 and sell it today you would earn a total of 50.00 from holding Aegon NV or generate 8.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koninklijke KPN NV vs. Aegon NV
Performance |
| Timeline |
| Koninklijke KPN NV |
| Aegon NV |
Koninklijke KPN and Aegon NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koninklijke KPN and Aegon NV
The main advantage of trading using opposite Koninklijke KPN and Aegon NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koninklijke KPN position performs unexpectedly, Aegon NV 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 Aegon NV will offset losses from the drop in Aegon NV's long position.| Koninklijke KPN vs. Aegon NV | Koninklijke KPN vs. Koninklijke Philips NV | Koninklijke KPN vs. Randstad NV | Koninklijke KPN vs. Akzo Nobel NV |
| Aegon NV vs. ING Groep NV | Aegon NV vs. Koninklijke KPN NV | Aegon NV vs. ABN Amro Group | Aegon NV vs. NN Group NV |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments |