Correlation Between TMT Steel and Kulthorn Kirby
Can any of the company-specific risk be diversified away by investing in both TMT Steel and Kulthorn Kirby 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 TMT Steel and Kulthorn Kirby into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TMT Steel Public and Kulthorn Kirby Public, you can compare the effects of market volatilities on TMT Steel and Kulthorn Kirby 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 TMT Steel with a short position of Kulthorn Kirby. Check out your portfolio center. Please also check ongoing floating volatility patterns of TMT Steel and Kulthorn Kirby.
Diversification Opportunities for TMT Steel and Kulthorn Kirby
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between TMT and Kulthorn is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding TMT Steel Public and Kulthorn Kirby Public in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kulthorn Kirby Public and TMT Steel 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 TMT Steel Public are associated (or correlated) with Kulthorn Kirby. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kulthorn Kirby Public has no effect on the direction of TMT Steel i.e., TMT Steel and Kulthorn Kirby go up and down completely randomly.
Pair Corralation between TMT Steel and Kulthorn Kirby
If you would invest 4.00 in Kulthorn Kirby Public on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Kulthorn Kirby Public or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TMT Steel Public vs. Kulthorn Kirby Public
Performance |
| Timeline |
| TMT Steel Public |
| Kulthorn Kirby Public |
TMT Steel and Kulthorn Kirby Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TMT Steel and Kulthorn Kirby
The main advantage of trading using opposite TMT Steel and Kulthorn Kirby positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TMT Steel position performs unexpectedly, Kulthorn Kirby 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 Kulthorn Kirby will offset losses from the drop in Kulthorn Kirby's long position.| TMT Steel vs. MCS Steel Public | TMT Steel vs. Thai Vegetable Oil | TMT Steel vs. Pacific Pipe Public | TMT Steel vs. Tipco Foods Public |
| Kulthorn Kirby vs. KGI Securities Public | Kulthorn Kirby vs. Kang Yong Electric | Kulthorn Kirby vs. Fine Metal Technologies | Kulthorn Kirby vs. Jasmine International Public |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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