Correlation Between Loews Corp and Kairous Acquisition
Can any of the company-specific risk be diversified away by investing in both Loews Corp and Kairous Acquisition 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 Loews Corp and Kairous Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Loews Corp and Kairous Acquisition Corp, you can compare the effects of market volatilities on Loews Corp and Kairous Acquisition 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 Loews Corp with a short position of Kairous Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of Loews Corp and Kairous Acquisition.
Diversification Opportunities for Loews Corp and Kairous Acquisition
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Loews and Kairous is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Loews Corp and Kairous Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kairous Acquisition Corp and Loews Corp 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 Loews Corp are associated (or correlated) with Kairous Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kairous Acquisition Corp has no effect on the direction of Loews Corp i.e., Loews Corp and Kairous Acquisition go up and down completely randomly.
Pair Corralation between Loews Corp and Kairous Acquisition
Taking into account the 90-day investment horizon Loews Corp is expected to generate 0.73 times more return on investment than Kairous Acquisition. However, Loews Corp is 1.37 times less risky than Kairous Acquisition. It trades about 0.1 of its potential returns per unit of risk. Kairous Acquisition Corp is currently generating about 0.02 per unit of risk. If you would invest 7,575 in Loews Corp on September 1, 2024 and sell it today you would earn a total of 1,098 from holding Loews Corp or generate 14.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Loews Corp vs. Kairous Acquisition Corp
Performance |
| Timeline |
| Loews Corp |
| Kairous Acquisition Corp |
Loews Corp and Kairous Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Loews Corp and Kairous Acquisition
The main advantage of trading using opposite Loews Corp and Kairous Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Loews Corp position performs unexpectedly, Kairous Acquisition 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 Kairous Acquisition will offset losses from the drop in Kairous Acquisition's long position.| Loews Corp vs. Horace Mann Educators | Loews Corp vs. Global Indemnity PLC | Loews Corp vs. Selective Insurance Group | Loews Corp vs. Kemper |
| Kairous Acquisition vs. Visa Class A | Kairous Acquisition vs. Diamond Hill Investment | Kairous Acquisition vs. Distoken Acquisition | Kairous Acquisition vs. Associated Capital Group |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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