Correlation Between Tradegate and KINGBOARD CHEMICAL
Can any of the company-specific risk be diversified away by investing in both Tradegate 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 Tradegate and KINGBOARD CHEMICAL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tradegate AG Wertpapierhandelsbank and KINGBOARD CHEMICAL, you can compare the effects of market volatilities on Tradegate 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 Tradegate with a short position of KINGBOARD CHEMICAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tradegate and KINGBOARD CHEMICAL.
Diversification Opportunities for Tradegate and KINGBOARD CHEMICAL
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tradegate and KINGBOARD is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Tradegate AG Wertpapierhandels and KINGBOARD CHEMICAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KINGBOARD CHEMICAL and Tradegate 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 Tradegate AG Wertpapierhandelsbank 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 Tradegate i.e., Tradegate and KINGBOARD CHEMICAL go up and down completely randomly.
Pair Corralation between Tradegate and KINGBOARD CHEMICAL
Assuming the 90 days horizon Tradegate AG Wertpapierhandelsbank is expected to under-perform the KINGBOARD CHEMICAL. But the stock apears to be less risky and, when comparing its historical volatility, Tradegate AG Wertpapierhandelsbank is 4.11 times less risky than KINGBOARD CHEMICAL. The stock trades about -0.19 of its potential returns per unit of risk. The KINGBOARD CHEMICAL is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 232.00 in KINGBOARD CHEMICAL on September 14, 2024 and sell it today you would earn a total of 6.00 from holding KINGBOARD CHEMICAL or generate 2.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tradegate AG Wertpapierhandels vs. KINGBOARD CHEMICAL
Performance |
| Timeline |
| Tradegate AG Wertpap |
| KINGBOARD CHEMICAL |
Tradegate and KINGBOARD CHEMICAL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tradegate and KINGBOARD CHEMICAL
The main advantage of trading using opposite Tradegate and KINGBOARD CHEMICAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tradegate 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.| Tradegate vs. Superior Plus Corp | Tradegate vs. SIVERS SEMICONDUCTORS AB | Tradegate vs. CHINA HUARONG ENERHD 50 | Tradegate vs. NORDIC HALIBUT AS |
| KINGBOARD CHEMICAL vs. ALIOR BANK | KINGBOARD CHEMICAL vs. DISTRICT METALS | KINGBOARD CHEMICAL vs. ADRIATIC METALS LS 013355 | KINGBOARD CHEMICAL vs. PT Bank Maybank |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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