Correlation Between Matador Resources and Kawasaki Kisen
Can any of the company-specific risk be diversified away by investing in both Matador Resources and Kawasaki Kisen 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 Matador Resources and Kawasaki Kisen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Matador Resources and Kawasaki Kisen Kaisha, you can compare the effects of market volatilities on Matador Resources and Kawasaki Kisen 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 Matador Resources with a short position of Kawasaki Kisen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Matador Resources and Kawasaki Kisen.
Diversification Opportunities for Matador Resources and Kawasaki Kisen
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Matador and Kawasaki is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Matador Resources and Kawasaki Kisen Kaisha in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kawasaki Kisen Kaisha and Matador Resources 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 Matador Resources are associated (or correlated) with Kawasaki Kisen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kawasaki Kisen Kaisha has no effect on the direction of Matador Resources i.e., Matador Resources and Kawasaki Kisen go up and down completely randomly.
Pair Corralation between Matador Resources and Kawasaki Kisen
Given the investment horizon of 90 days Matador Resources is expected to generate 4.14 times more return on investment than Kawasaki Kisen. However, Matador Resources is 4.14 times more volatile than Kawasaki Kisen Kaisha. It trades about 0.31 of its potential returns per unit of risk. Kawasaki Kisen Kaisha is currently generating about -0.21 per unit of risk. If you would invest 5,150 in Matador Resources on August 31, 2024 and sell it today you would earn a total of 806.00 from holding Matador Resources or generate 15.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Matador Resources vs. Kawasaki Kisen Kaisha
Performance |
| Timeline |
| Matador Resources |
| Kawasaki Kisen Kaisha |
Matador Resources and Kawasaki Kisen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Matador Resources and Kawasaki Kisen
The main advantage of trading using opposite Matador Resources and Kawasaki Kisen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Matador Resources position performs unexpectedly, Kawasaki Kisen 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 Kawasaki Kisen will offset losses from the drop in Kawasaki Kisen's long position.| Matador Resources vs. Murphy Oil | Matador Resources vs. Civitas Resources | Matador Resources vs. Permian Resources | Matador Resources vs. Antero Resources Corp |
| Kawasaki Kisen vs. Hapag Lloyd Aktiengesellschaft | Kawasaki Kisen vs. Hapag Lloyd Aktiengesellschaft | Kawasaki Kisen vs. AP Moeller Maersk AS | Kawasaki Kisen vs. AP Mller |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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