Correlation Between Kainos Group and Trade Desk
Can any of the company-specific risk be diversified away by investing in both Kainos Group and Trade Desk 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 Kainos Group and Trade Desk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kainos Group plc and Trade Desk, you can compare the effects of market volatilities on Kainos Group and Trade Desk 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 Kainos Group with a short position of Trade Desk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kainos Group and Trade Desk.
Diversification Opportunities for Kainos Group and Trade Desk
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kainos and Trade is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Kainos Group plc and Trade Desk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trade Desk and Kainos Group 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 Kainos Group plc are associated (or correlated) with Trade Desk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trade Desk has no effect on the direction of Kainos Group i.e., Kainos Group and Trade Desk go up and down completely randomly.
Pair Corralation between Kainos Group and Trade Desk
Assuming the 90 days horizon Kainos Group plc is expected to generate 2.2 times more return on investment than Trade Desk. However, Kainos Group is 2.2 times more volatile than Trade Desk. It trades about 0.05 of its potential returns per unit of risk. Trade Desk is currently generating about -0.12 per unit of risk. If you would invest 1,045 in Kainos Group plc on September 24, 2024 and sell it today you would earn a total of 26.00 from holding Kainos Group plc or generate 2.49% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 95.24% |
Values | Daily Returns |
Kainos Group plc vs. Trade Desk
Performance |
Timeline |
Kainos Group plc |
Trade Desk |
Kainos Group and Trade Desk Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Kainos Group and Trade Desk
The main advantage of trading using opposite Kainos Group and Trade Desk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kainos Group position performs unexpectedly, Trade Desk 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 Trade Desk will offset losses from the drop in Trade Desk's long position.Kainos Group vs. NextPlat Corp | Kainos Group vs. Liquid Avatar Technologies | Kainos Group vs. Waldencast Acquisition Corp | Kainos Group vs. CXApp Inc |
Trade Desk vs. Dubber Limited | Trade Desk vs. Advanced Health Intelligence | Trade Desk vs. Danavation Technologies Corp | Trade Desk vs. BASE Inc |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |