Correlation Between Kmw and ALTEOGEN

Can any of the company-specific risk be diversified away by investing in both Kmw and ALTEOGEN 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 Kmw and ALTEOGEN into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Kmw Inc and ALTEOGEN, you can compare the effects of market volatilities on Kmw and ALTEOGEN 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 Kmw with a short position of ALTEOGEN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kmw and ALTEOGEN.

Diversification Opportunities for Kmw and ALTEOGEN

0.0

Correlation Coefficient

Kmw  ALTEOGEN

Pay attention - limited upside

The 3 months correlation between Kmw and ALTEOGEN is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Kmw Inc and ALTEOGEN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALTEOGEN and Kmw 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 Kmw Inc are associated (or correlated) with ALTEOGEN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALTEOGEN has no effect on the direction of Kmw i.e., Kmw and ALTEOGEN go up and down completely randomly.

Pair Corralation between Kmw and ALTEOGEN

If you would invest  0.00  in ALTEOGEN on October 1, 2024 and sell it today you would earn a total of  0.00  from holding ALTEOGEN or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Kmw Inc  vs.  ALTEOGEN

Kmw Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kmw Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Kmw is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

ALTEOGEN

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days ALTEOGEN has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, ALTEOGEN is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Kmw and ALTEOGEN

The main advantage of trading using opposite Kmw and ALTEOGEN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kmw position performs unexpectedly, ALTEOGEN 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 ALTEOGEN will offset losses from the drop in ALTEOGEN's long position.

The idea behind Kmw Inc and ALTEOGEN pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Global Correlations module to find global opportunities by holding instruments from different markets.