Correlation Between Armada Hflr and KTBST Mixed

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

By analyzing existing cross correlation between Armada Hflr Pr and KTBST Mixed Leasehold, you can compare the effects of market volatilities on Armada Hflr and KTBST Mixed 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 Armada Hflr with a short position of KTBST Mixed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Armada Hflr and KTBST Mixed.

Diversification Opportunities for Armada Hflr and KTBST Mixed

0.0

Correlation Coefficient

Armada Hflr  KTBST Mixed

Pay attention - limited upside

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

Pair Corralation between Armada Hflr and KTBST Mixed

Considering the 90-day investment horizon Armada Hflr Pr is expected to under-perform the KTBST Mixed. In addition to that, Armada Hflr is 1.44 times more volatile than KTBST Mixed Leasehold. It trades about -0.08 of its total potential returns per unit of risk. KTBST Mixed Leasehold is currently generating about 0.01 per unit of volatility. If you would invest  638.00  in KTBST Mixed Leasehold on September 14, 2024 and sell it today you would earn a total of  2.00  from holding KTBST Mixed Leasehold or generate 0.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Armada Hflr Pr  vs.  KTBST Mixed Leasehold

Armada Hflr Pr

Risk-Adjusted Performance

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Very Weak

Over the last 90 days Armada Hflr Pr has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

KTBST Mixed Leasehold

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KTBST Mixed Leasehold has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, KTBST Mixed is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.

Pair Trading with Armada Hflr and KTBST Mixed

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

The idea behind Armada Hflr Pr and KTBST Mixed Leasehold 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.