Correlation Between Kering SA and Superior Plus
Can any of the company-specific risk be diversified away by investing in both Kering SA and Superior Plus 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 Superior Plus into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kering SA and Superior Plus Corp, you can compare the effects of market volatilities on Kering SA and Superior Plus 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 Superior Plus. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kering SA and Superior Plus.
Diversification Opportunities for Kering SA and Superior Plus
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kering and Superior is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Kering SA and Superior Plus Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Superior Plus Corp 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 Superior Plus. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Superior Plus Corp has no effect on the direction of Kering SA i.e., Kering SA and Superior Plus go up and down completely randomly.
Pair Corralation between Kering SA and Superior Plus
Assuming the 90 days horizon Kering SA is expected to under-perform the Superior Plus. In addition to that, Kering SA is 1.02 times more volatile than Superior Plus Corp. It trades about -0.09 of its total potential returns per unit of risk. Superior Plus Corp is currently generating about -0.03 per unit of volatility. If you would invest 576.00 in Superior Plus Corp on August 31, 2024 and sell it today you would lose (150.00) from holding Superior Plus Corp or give up 26.04% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kering SA vs. Superior Plus Corp
Performance |
| Timeline |
| Kering SA |
| Superior Plus Corp |
Kering SA and Superior Plus Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kering SA and Superior Plus
The main advantage of trading using opposite Kering SA and Superior Plus positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kering SA position performs unexpectedly, Superior Plus 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 Superior Plus will offset losses from the drop in Superior Plus' long position.| Kering SA vs. TITANIUM TRANSPORTGROUP | Kering SA vs. NTG Nordic Transport | Kering SA vs. KAUFMAN ET BROAD | Kering SA vs. Gaztransport Technigaz SA |
| Superior Plus vs. BROADSTNET LEADL 00025 | Superior Plus vs. Mitsubishi Materials | Superior Plus vs. Martin Marietta Materials | Superior Plus vs. Summit Materials |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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