Correlation Between Odyssean Investment and Kinnevik Investment
Can any of the company-specific risk be diversified away by investing in both Odyssean Investment and Kinnevik Investment 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 Odyssean Investment and Kinnevik Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Odyssean Investment Trust and Kinnevik Investment AB, you can compare the effects of market volatilities on Odyssean Investment and Kinnevik Investment 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 Odyssean Investment with a short position of Kinnevik Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Odyssean Investment and Kinnevik Investment.
Diversification Opportunities for Odyssean Investment and Kinnevik Investment
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Odyssean and Kinnevik is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Odyssean Investment Trust and Kinnevik Investment AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinnevik Investment and Odyssean Investment 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 Odyssean Investment Trust are associated (or correlated) with Kinnevik Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinnevik Investment has no effect on the direction of Odyssean Investment i.e., Odyssean Investment and Kinnevik Investment go up and down completely randomly.
Pair Corralation between Odyssean Investment and Kinnevik Investment
Assuming the 90 days trading horizon Odyssean Investment Trust is expected to generate 0.5 times more return on investment than Kinnevik Investment. However, Odyssean Investment Trust is 2.0 times less risky than Kinnevik Investment. It trades about -0.01 of its potential returns per unit of risk. Kinnevik Investment AB is currently generating about -0.05 per unit of risk. If you would invest 17,625 in Odyssean Investment Trust on August 24, 2024 and sell it today you would lose (1,825) from holding Odyssean Investment Trust or give up 10.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 98.42% |
| Values | Daily Returns |
Odyssean Investment Trust vs. Kinnevik Investment AB
Performance |
| Timeline |
| Odyssean Investment Trust |
| Kinnevik Investment |
Odyssean Investment and Kinnevik Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Odyssean Investment and Kinnevik Investment
The main advantage of trading using opposite Odyssean Investment and Kinnevik Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Odyssean Investment position performs unexpectedly, Kinnevik Investment 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 Kinnevik Investment will offset losses from the drop in Kinnevik Investment's long position.| Odyssean Investment vs. Wyndham Hotels Resorts | Odyssean Investment vs. Park Hotels Resorts | Odyssean Investment vs. Regions Financial Corp | Odyssean Investment vs. BW Offshore |
| Kinnevik Investment vs. Panther Metals PLC | Kinnevik Investment vs. MTI Wireless Edge | Kinnevik Investment vs. Golden Metal Resources | Kinnevik Investment vs. Systemair AB |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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