Correlation Between Kering SA and Chow Sang
Can any of the company-specific risk be diversified away by investing in both Kering SA and Chow Sang 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 Kering SA and Chow Sang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kering SA and Chow Sang Sang, you can compare the effects of market volatilities on Kering SA and Chow Sang 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 Kering SA with a short position of Chow Sang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kering SA and Chow Sang.
Diversification Opportunities for Kering SA and Chow Sang
Excellent diversification
The 3 months correlation between Kering and Chow is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Kering SA and Chow Sang Sang in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chow Sang Sang and Kering SA 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 Kering SA are associated (or correlated) with Chow Sang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chow Sang Sang has no effect on the direction of Kering SA i.e., Kering SA and Chow Sang go up and down completely randomly.
Pair Corralation between Kering SA and Chow Sang
Assuming the 90 days horizon Kering SA is expected to under-perform the Chow Sang. In addition to that, Kering SA is 11.23 times more volatile than Chow Sang Sang. It trades about -0.09 of its total potential returns per unit of risk. Chow Sang Sang is currently generating about 0.09 per unit of volatility. If you would invest 97.00 in Chow Sang Sang on August 27, 2024 and sell it today you would earn a total of 2.00 from holding Chow Sang Sang or generate 2.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 25.49% |
| Values | Daily Returns |
Kering SA vs. Chow Sang Sang
Performance |
| Timeline |
| Kering SA |
| Chow Sang Sang |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Kering SA and Chow Sang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kering SA and Chow Sang
The main advantage of trading using opposite Kering SA and Chow Sang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kering SA position performs unexpectedly, Chow Sang 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 Chow Sang will offset losses from the drop in Chow Sang's long position.| Kering SA vs. Burberry Group Plc | Kering SA vs. Swatch Group AG | Kering SA vs. Prada Spa PK | Kering SA vs. Compagnie Financire Richemont |
| Chow Sang vs. Siriuspoint | Chow Sang vs. Barings BDC | Chow Sang vs. Chiba Bank Ltd | Chow Sang vs. Fomento Economico Mexicano |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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