Correlation Between Transtema Group and Kambi Group
Can any of the company-specific risk be diversified away by investing in both Transtema Group and Kambi Group 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 Transtema Group and Kambi Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Transtema Group AB and Kambi Group PLC, you can compare the effects of market volatilities on Transtema Group and Kambi 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 Transtema Group with a short position of Kambi Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Transtema Group and Kambi Group.
Diversification Opportunities for Transtema Group and Kambi Group
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Transtema and Kambi is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Transtema Group AB and Kambi Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kambi Group PLC and Transtema Group 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 Transtema Group AB are associated (or correlated) with Kambi Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kambi Group PLC has no effect on the direction of Transtema Group i.e., Transtema Group and Kambi Group go up and down completely randomly.
Pair Corralation between Transtema Group and Kambi Group
Assuming the 90 days trading horizon Transtema Group AB is expected to under-perform the Kambi Group. In addition to that, Transtema Group is 1.18 times more volatile than Kambi Group PLC. It trades about -0.03 of its total potential returns per unit of risk. Kambi Group PLC is currently generating about -0.03 per unit of volatility. If you would invest 19,265 in Kambi Group PLC on September 4, 2024 and sell it today you would lose (9,035) from holding Kambi Group PLC or give up 46.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Transtema Group AB vs. Kambi Group PLC
Performance |
| Timeline |
| Transtema Group AB |
| Kambi Group PLC |
Transtema Group and Kambi Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Transtema Group and Kambi Group
The main advantage of trading using opposite Transtema Group and Kambi Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Transtema Group position performs unexpectedly, Kambi 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 Kambi Group will offset losses from the drop in Kambi Group's long position.| Transtema Group vs. Kambi Group PLC | Transtema Group vs. Bambuser AB | Transtema Group vs. Evolution AB | Transtema Group vs. Zaptec AS |
| Kambi Group vs. Evolution AB | Kambi Group vs. Embracer Group AB | Kambi Group vs. Betsson AB | Kambi Group vs. Catena Media plc |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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