Correlation Between Paradox Interactive and Kindred Group
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By analyzing existing cross correlation between Paradox Interactive AB and Kindred Group plc, you can compare the effects of market volatilities on Paradox Interactive and Kindred Group 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 Paradox Interactive with a short position of Kindred Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Paradox Interactive and Kindred Group.
Diversification Opportunities for Paradox Interactive and Kindred Group
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Paradox and Kindred is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Paradox Interactive AB and Kindred Group plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kindred Group plc and Paradox Interactive 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 Paradox Interactive AB are associated (or correlated) with Kindred Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kindred Group plc has no effect on the direction of Paradox Interactive i.e., Paradox Interactive and Kindred Group go up and down completely randomly.
Pair Corralation between Paradox Interactive and Kindred Group
Assuming the 90 days trading horizon Paradox Interactive is expected to generate 3.64 times less return on investment than Kindred Group. In addition to that, Paradox Interactive is 1.24 times more volatile than Kindred Group plc. It trades about 0.01 of its total potential returns per unit of risk. Kindred Group plc is currently generating about 0.02 per unit of volatility. If you would invest 11,240 in Kindred Group plc on August 24, 2024 and sell it today you would earn a total of 1,670 from holding Kindred Group plc or generate 14.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.39% |
| Values | Daily Returns |
Paradox Interactive AB vs. Kindred Group plc
Performance |
| Timeline |
| Paradox Interactive |
| Kindred Group plc |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
Paradox Interactive and Kindred Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Paradox Interactive and Kindred Group
The main advantage of trading using opposite Paradox Interactive and Kindred Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Paradox Interactive position performs unexpectedly, Kindred Group 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 Kindred Group will offset losses from the drop in Kindred Group's long position.| Paradox Interactive vs. Stillfront Group AB | Paradox Interactive vs. Embracer Group AB | Paradox Interactive vs. G5 Entertainment publ | Paradox Interactive vs. Evolution AB |
| Kindred Group vs. Kambi Group PLC | Kindred Group vs. Betsson AB | Kindred Group vs. Evolution AB | Kindred Group vs. Embracer Group 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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