Correlation Between Keyence and Global Warming
Can any of the company-specific risk be diversified away by investing in both Keyence and Global Warming 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 Keyence and Global Warming into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Keyence and Global Warming Solut, you can compare the effects of market volatilities on Keyence and Global Warming 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 Keyence with a short position of Global Warming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keyence and Global Warming.
Diversification Opportunities for Keyence and Global Warming
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Keyence and Global is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Keyence and Global Warming Solut in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Warming Solut and Keyence 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 Keyence are associated (or correlated) with Global Warming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Warming Solut has no effect on the direction of Keyence i.e., Keyence and Global Warming go up and down completely randomly.
Pair Corralation between Keyence and Global Warming
Assuming the 90 days horizon Keyence is expected to generate 0.14 times more return on investment than Global Warming. However, Keyence is 7.31 times less risky than Global Warming. It trades about -0.1 of its potential returns per unit of risk. Global Warming Solut is currently generating about -0.04 per unit of risk. If you would invest 42,901 in Keyence on September 22, 2024 and sell it today you would lose (1,701) from holding Keyence or give up 3.96% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Keyence vs. Global Warming Solut
Performance |
| Timeline |
| Keyence |
| Global Warming Solut |
Keyence and Global Warming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Keyence and Global Warming
The main advantage of trading using opposite Keyence and Global Warming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keyence position performs unexpectedly, Global Warming 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 Global Warming will offset losses from the drop in Global Warming's long position.| Keyence vs. Mind Technology | Keyence vs. Wrap Technologies | Keyence vs. Cepton Inc | Keyence vs. Microvision |
| Global Warming vs. Mind Technology | Global Warming vs. Wrap Technologies | Global Warming vs. Cepton Inc | Global Warming vs. Microvision |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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