Correlation Between OFFICE DEPOT and KINGBOARD CHEMICAL
Can any of the company-specific risk be diversified away by investing in both OFFICE DEPOT and KINGBOARD CHEMICAL 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 OFFICE DEPOT and KINGBOARD CHEMICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between OFFICE DEPOT and KINGBOARD CHEMICAL, you can compare the effects of market volatilities on OFFICE DEPOT and KINGBOARD CHEMICAL 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 OFFICE DEPOT with a short position of KINGBOARD CHEMICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of OFFICE DEPOT and KINGBOARD CHEMICAL.
Diversification Opportunities for OFFICE DEPOT and KINGBOARD CHEMICAL
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between OFFICE and KINGBOARD is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding OFFICE DEPOT and KINGBOARD CHEMICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KINGBOARD CHEMICAL and OFFICE DEPOT 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 OFFICE DEPOT are associated (or correlated) with KINGBOARD CHEMICAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KINGBOARD CHEMICAL has no effect on the direction of OFFICE DEPOT i.e., OFFICE DEPOT and KINGBOARD CHEMICAL go up and down completely randomly.
Pair Corralation between OFFICE DEPOT and KINGBOARD CHEMICAL
If you would invest 137.00 in KINGBOARD CHEMICAL on October 16, 2024 and sell it today you would earn a total of 103.00 from holding KINGBOARD CHEMICAL or generate 75.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
OFFICE DEPOT vs. KINGBOARD CHEMICAL
Performance |
| Timeline |
| OFFICE DEPOT |
| KINGBOARD CHEMICAL |
OFFICE DEPOT and KINGBOARD CHEMICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with OFFICE DEPOT and KINGBOARD CHEMICAL
The main advantage of trading using opposite OFFICE DEPOT and KINGBOARD CHEMICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if OFFICE DEPOT position performs unexpectedly, KINGBOARD CHEMICAL 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 KINGBOARD CHEMICAL will offset losses from the drop in KINGBOARD CHEMICAL's long position.| OFFICE DEPOT vs. Daito Trust Construction | OFFICE DEPOT vs. Dairy Farm International | OFFICE DEPOT vs. Tsingtao Brewery | OFFICE DEPOT vs. China Resources Beer |
| KINGBOARD CHEMICAL vs. IMPERIAL TOBACCO | KINGBOARD CHEMICAL vs. CAIRN HOMES EO | KINGBOARD CHEMICAL vs. CarsalesCom | KINGBOARD CHEMICAL vs. OFFICE DEPOT |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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