Correlation Between XMReality and KABE Group
Can any of the company-specific risk be diversified away by investing in both XMReality and KABE 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 XMReality and KABE Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between XMReality AB and KABE Group AB, you can compare the effects of market volatilities on XMReality and KABE 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 XMReality with a short position of KABE Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of XMReality and KABE Group.
Diversification Opportunities for XMReality and KABE Group
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between XMReality and KABE is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding XMReality AB and KABE Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KABE Group AB and XMReality 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 XMReality AB are associated (or correlated) with KABE Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KABE Group AB has no effect on the direction of XMReality i.e., XMReality and KABE Group go up and down completely randomly.
Pair Corralation between XMReality and KABE Group
Assuming the 90 days trading horizon XMReality AB is expected to generate 2.56 times more return on investment than KABE Group. However, XMReality is 2.56 times more volatile than KABE Group AB. It trades about -0.01 of its potential returns per unit of risk. KABE Group AB is currently generating about -0.08 per unit of risk. If you would invest 2.20 in XMReality AB on August 29, 2024 and sell it today you would lose (0.10) from holding XMReality AB or give up 4.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
XMReality AB vs. KABE Group AB
Performance |
| Timeline |
| XMReality AB |
| KABE Group AB |
XMReality and KABE Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with XMReality and KABE Group
The main advantage of trading using opposite XMReality and KABE Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if XMReality position performs unexpectedly, KABE 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 KABE Group will offset losses from the drop in KABE Group's long position.| XMReality vs. Lifco AB | XMReality vs. Lagercrantz Group AB | XMReality vs. Addtech AB | XMReality vs. Instalco Intressenter AB |
| KABE Group vs. Byggmax Group AB | KABE Group vs. Svedbergs i Dalstorp | KABE Group vs. Inwido AB | KABE Group vs. New Wave Group |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
Other Complementary Tools
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |