Correlation Between Koninklijke Vopak and TKH Group
Can any of the company-specific risk be diversified away by investing in both Koninklijke Vopak and TKH 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 Koninklijke Vopak and TKH Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Koninklijke Vopak NV and TKH Group NV, you can compare the effects of market volatilities on Koninklijke Vopak and TKH 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 Koninklijke Vopak with a short position of TKH Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Koninklijke Vopak and TKH Group.
Diversification Opportunities for Koninklijke Vopak and TKH Group
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Koninklijke and TKH is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Koninklijke Vopak NV and TKH Group NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TKH Group NV and Koninklijke Vopak 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 Koninklijke Vopak NV are associated (or correlated) with TKH Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TKH Group NV has no effect on the direction of Koninklijke Vopak i.e., Koninklijke Vopak and TKH Group go up and down completely randomly.
Pair Corralation between Koninklijke Vopak and TKH Group
Assuming the 90 days trading horizon Koninklijke Vopak NV is expected to generate 0.76 times more return on investment than TKH Group. However, Koninklijke Vopak NV is 1.32 times less risky than TKH Group. It trades about 0.12 of its potential returns per unit of risk. TKH Group NV is currently generating about -0.14 per unit of risk. If you would invest 3,740 in Koninklijke Vopak NV on August 28, 2024 and sell it today you would earn a total of 702.00 from holding Koninklijke Vopak NV or generate 18.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Koninklijke Vopak NV vs. TKH Group NV
Performance |
| Timeline |
| Koninklijke Vopak |
| TKH Group NV |
Koninklijke Vopak and TKH Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Koninklijke Vopak and TKH Group
The main advantage of trading using opposite Koninklijke Vopak and TKH Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Koninklijke Vopak position performs unexpectedly, TKH 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 TKH Group will offset losses from the drop in TKH Group's long position.| Koninklijke Vopak vs. Aalberts Industries NV | Koninklijke Vopak vs. SBM Offshore NV | Koninklijke Vopak vs. NN Group NV | Koninklijke Vopak vs. Randstad NV |
| TKH Group vs. Aalberts Industries NV | TKH Group vs. BE Semiconductor Industries | TKH Group vs. AMG Advanced Metallurgical | TKH Group vs. Koninklijke Vopak NV |
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.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Stocks Directory Find actively traded stocks across global markets | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |