Correlation Between Kyocera and Sony Group
Can any of the company-specific risk be diversified away by investing in both Kyocera and Sony Group 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 Kyocera and Sony Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kyocera and Sony Group Corp, you can compare the effects of market volatilities on Kyocera and Sony Group 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 Kyocera with a short position of Sony Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kyocera and Sony Group.
Diversification Opportunities for Kyocera and Sony Group
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kyocera and Sony is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Kyocera and Sony Group Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sony Group Corp and Kyocera 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 Kyocera are associated (or correlated) with Sony Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sony Group Corp has no effect on the direction of Kyocera i.e., Kyocera and Sony Group go up and down completely randomly.
Pair Corralation between Kyocera and Sony Group
Assuming the 90 days horizon Kyocera is expected to under-perform the Sony Group. But the stock apears to be less risky and, when comparing its historical volatility, Kyocera is 1.09 times less risky than Sony Group. The stock trades about -0.12 of its potential returns per unit of risk. The Sony Group Corp is currently generating about 0.26 of returns per unit of risk over similar time horizon. If you would invest 1,660 in Sony Group Corp on August 31, 2024 and sell it today you would earn a total of 228.00 from holding Sony Group Corp or generate 13.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kyocera vs. Sony Group Corp
Performance |
| Timeline |
| Kyocera |
| Sony Group Corp |
Kyocera and Sony Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kyocera and Sony Group
The main advantage of trading using opposite Kyocera and Sony Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kyocera position performs unexpectedly, Sony Group 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 Sony Group will offset losses from the drop in Sony Group's long position.| Kyocera vs. ATRESMEDIA | Kyocera vs. UMC Electronics Co | Kyocera vs. STMicroelectronics NV | Kyocera vs. LG Display Co |
| Sony Group vs. Apple Inc | Sony Group vs. Apple Inc | Sony Group vs. Samsung Electronics Co | Sony Group vs. Samsung Electronics Co |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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