Correlation Between Ring Energy and KENTIMA HOLDING
Can any of the company-specific risk be diversified away by investing in both Ring Energy and KENTIMA HOLDING 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 Ring Energy and KENTIMA HOLDING into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ring Energy and KENTIMA HOLDING AB, you can compare the effects of market volatilities on Ring Energy and KENTIMA HOLDING 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 Ring Energy with a short position of KENTIMA HOLDING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ring Energy and KENTIMA HOLDING.
Diversification Opportunities for Ring Energy and KENTIMA HOLDING
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Ring and KENTIMA is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Ring Energy and KENTIMA HOLDING AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KENTIMA HOLDING AB and Ring Energy 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 Ring Energy are associated (or correlated) with KENTIMA HOLDING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KENTIMA HOLDING AB has no effect on the direction of Ring Energy i.e., Ring Energy and KENTIMA HOLDING go up and down completely randomly.
Pair Corralation between Ring Energy and KENTIMA HOLDING
Assuming the 90 days trading horizon Ring Energy is expected to generate 1.27 times less return on investment than KENTIMA HOLDING. But when comparing it to its historical volatility, Ring Energy is 2.23 times less risky than KENTIMA HOLDING. It trades about 0.07 of its potential returns per unit of risk. KENTIMA HOLDING AB is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 16.00 in KENTIMA HOLDING AB on September 2, 2024 and sell it today you would earn a total of 0.00 from holding KENTIMA HOLDING AB or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ring Energy vs. KENTIMA HOLDING AB
Performance |
| Timeline |
| Ring Energy |
| KENTIMA HOLDING AB |
Ring Energy and KENTIMA HOLDING Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ring Energy and KENTIMA HOLDING
The main advantage of trading using opposite Ring Energy and KENTIMA HOLDING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ring Energy position performs unexpectedly, KENTIMA HOLDING 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 KENTIMA HOLDING will offset losses from the drop in KENTIMA HOLDING's long position.| Ring Energy vs. Perseus Mining Limited | Ring Energy vs. MCEWEN MINING INC | Ring Energy vs. Global Ship Lease | Ring Energy vs. CarsalesCom |
| KENTIMA HOLDING vs. Laureate Education | KENTIMA HOLDING vs. EMBARK EDUCATION LTD | KENTIMA HOLDING vs. SEKISUI CHEMICAL | KENTIMA HOLDING vs. Soken Chemical Engineering |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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