Correlation Between ITALIAN WINE and KOWORLD AG
Can any of the company-specific risk be diversified away by investing in both ITALIAN WINE and KOWORLD AG 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 ITALIAN WINE and KOWORLD AG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ITALIAN WINE BRANDS and KOWORLD AG, you can compare the effects of market volatilities on ITALIAN WINE and KOWORLD AG 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 ITALIAN WINE with a short position of KOWORLD AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of ITALIAN WINE and KOWORLD AG.
Diversification Opportunities for ITALIAN WINE and KOWORLD AG
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ITALIAN and KOWORLD is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding ITALIAN WINE BRANDS and KOWORLD AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KOWORLD AG and ITALIAN WINE 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 ITALIAN WINE BRANDS are associated (or correlated) with KOWORLD AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KOWORLD AG has no effect on the direction of ITALIAN WINE i.e., ITALIAN WINE and KOWORLD AG go up and down completely randomly.
Pair Corralation between ITALIAN WINE and KOWORLD AG
Assuming the 90 days horizon ITALIAN WINE BRANDS is expected to under-perform the KOWORLD AG. But the stock apears to be less risky and, when comparing its historical volatility, ITALIAN WINE BRANDS is 1.3 times less risky than KOWORLD AG. The stock trades about -0.01 of its potential returns per unit of risk. The KOWORLD AG is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 3,160 in KOWORLD AG on September 14, 2024 and sell it today you would lose (280.00) from holding KOWORLD AG or give up 8.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.6% |
| Values | Daily Returns |
ITALIAN WINE BRANDS vs. KOWORLD AG
Performance |
| Timeline |
| ITALIAN WINE BRANDS |
| KOWORLD AG |
ITALIAN WINE and KOWORLD AG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ITALIAN WINE and KOWORLD AG
The main advantage of trading using opposite ITALIAN WINE and KOWORLD AG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ITALIAN WINE position performs unexpectedly, KOWORLD AG 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 KOWORLD AG will offset losses from the drop in KOWORLD AG's long position.| ITALIAN WINE vs. NAKED WINES PLC | ITALIAN WINE vs. CHINA TONTINE WINES | ITALIAN WINE vs. Superior Plus Corp | ITALIAN WINE vs. SIVERS SEMICONDUCTORS AB |
| KOWORLD AG vs. Summit Materials | KOWORLD AG vs. Rayonier Advanced Materials | KOWORLD AG vs. ITALIAN WINE BRANDS | KOWORLD AG vs. SANOK RUBBER ZY |
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 Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Equity Valuation Check real value of public entities based on technical and fundamental data |