Correlation Between KRA Dd and Podravka Prehrambena
Can any of the company-specific risk be diversified away by investing in both KRA Dd and Podravka Prehrambena 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 KRA Dd and Podravka Prehrambena into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KRA dd and Podravka Prehrambena Industrija, you can compare the effects of market volatilities on KRA Dd and Podravka Prehrambena 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 KRA Dd with a short position of Podravka Prehrambena. Check out your portfolio center. Please also check ongoing floating volatility patterns of KRA Dd and Podravka Prehrambena.
Diversification Opportunities for KRA Dd and Podravka Prehrambena
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between KRA and Podravka is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding KRA dd and Podravka Prehrambena Industrij in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Podravka Prehrambena and KRA Dd 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 KRA dd are associated (or correlated) with Podravka Prehrambena. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Podravka Prehrambena has no effect on the direction of KRA Dd i.e., KRA Dd and Podravka Prehrambena go up and down completely randomly.
Pair Corralation between KRA Dd and Podravka Prehrambena
Assuming the 90 days trading horizon KRA dd is expected to under-perform the Podravka Prehrambena. In addition to that, KRA Dd is 1.63 times more volatile than Podravka Prehrambena Industrija. It trades about -0.29 of its total potential returns per unit of risk. Podravka Prehrambena Industrija is currently generating about -0.03 per unit of volatility. If you would invest 14,450 in Podravka Prehrambena Industrija on October 20, 2024 and sell it today you would lose (150.00) from holding Podravka Prehrambena Industrija or give up 1.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 35.29% |
| Values | Daily Returns |
KRA dd vs. Podravka Prehrambena Industrij
Performance |
| Timeline |
| KRA dd |
| Podravka Prehrambena |
KRA Dd and Podravka Prehrambena Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KRA Dd and Podravka Prehrambena
The main advantage of trading using opposite KRA Dd and Podravka Prehrambena positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KRA Dd position performs unexpectedly, Podravka Prehrambena 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 Podravka Prehrambena will offset losses from the drop in Podravka Prehrambena's long position.| KRA Dd vs. AD Plastik dd | KRA Dd vs. Hrvatska Postanska Banka | KRA Dd vs. Dalekovod dd | KRA Dd vs. Podravka Prehrambena Industrija |
| Podravka Prehrambena vs. Dalekovod dd | Podravka Prehrambena vs. Institut IGH dd | Podravka Prehrambena vs. Jadroplov dd | Podravka Prehrambena vs. KRA dd |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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