Correlation Between Vow Green and Kitron ASA
Can any of the company-specific risk be diversified away by investing in both Vow Green and Kitron ASA 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 Vow Green and Kitron ASA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vow Green Metals and Kitron ASA, you can compare the effects of market volatilities on Vow Green and Kitron ASA 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 Vow Green with a short position of Kitron ASA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vow Green and Kitron ASA.
Diversification Opportunities for Vow Green and Kitron ASA
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Vow and Kitron is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Vow Green Metals and Kitron ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kitron ASA and Vow Green 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 Vow Green Metals are associated (or correlated) with Kitron ASA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kitron ASA has no effect on the direction of Vow Green i.e., Vow Green and Kitron ASA go up and down completely randomly.
Pair Corralation between Vow Green and Kitron ASA
Assuming the 90 days trading horizon Vow Green Metals is expected to under-perform the Kitron ASA. In addition to that, Vow Green is 3.31 times more volatile than Kitron ASA. It trades about -0.1 of its total potential returns per unit of risk. Kitron ASA is currently generating about -0.01 per unit of volatility. If you would invest 3,048 in Kitron ASA on August 28, 2024 and sell it today you would lose (20.00) from holding Kitron ASA or give up 0.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Vow Green Metals vs. Kitron ASA
Performance |
| Timeline |
| Vow Green Metals |
| Kitron ASA |
Vow Green and Kitron ASA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vow Green and Kitron ASA
The main advantage of trading using opposite Vow Green and Kitron ASA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vow Green position performs unexpectedly, Kitron ASA 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 Kitron ASA will offset losses from the drop in Kitron ASA's long position.| Vow Green vs. Waste Plastic Upcycling | Vow Green vs. SpareBank 1 stlandet | Vow Green vs. Kraft Bank Asa | Vow Green vs. Sogn Sparebank |
| Kitron ASA vs. Europris ASA | Kitron ASA vs. Kongsberg Gruppen ASA | Kitron ASA vs. Nordic Semiconductor ASA | Kitron ASA vs. Storebrand ASA |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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