Correlation Between Kuka AG and Guangdong Investment
Can any of the company-specific risk be diversified away by investing in both Kuka AG and Guangdong Investment 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 Kuka AG and Guangdong Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kuka AG ADR and Guangdong Investment Limited, you can compare the effects of market volatilities on Kuka AG and Guangdong Investment 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 Kuka AG with a short position of Guangdong Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kuka AG and Guangdong Investment.
Diversification Opportunities for Kuka AG and Guangdong Investment
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kuka and Guangdong is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Kuka AG ADR and Guangdong Investment Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Investment and Kuka 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 Kuka AG ADR are associated (or correlated) with Guangdong Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Investment has no effect on the direction of Kuka AG i.e., Kuka AG and Guangdong Investment go up and down completely randomly.
Pair Corralation between Kuka AG and Guangdong Investment
If you would invest 60.00 in Guangdong Investment Limited on September 5, 2024 and sell it today you would earn a total of 1.00 from holding Guangdong Investment Limited or generate 1.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.81% |
| Values | Daily Returns |
Kuka AG ADR vs. Guangdong Investment Limited
Performance |
| Timeline |
| Kuka AG ADR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Guangdong Investment |
Kuka AG and Guangdong Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kuka AG and Guangdong Investment
The main advantage of trading using opposite Kuka AG and Guangdong Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kuka AG position performs unexpectedly, Guangdong Investment 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 Guangdong Investment will offset losses from the drop in Guangdong Investment's long position.| Kuka AG vs. Guangdong Investment Limited | Kuka AG vs. Fast Retailing Co | Kuka AG vs. Old Republic International | Kuka AG vs. Aegon NV ADR |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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