Correlation Between SLC Agrcola and Kepler Weber

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

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

Diversification Opportunities for SLC Agrcola and Kepler Weber

-0.15

Correlation Coefficient

SLC Agrcola  Kepler Weber

Good diversification

The 3 months correlation between SLC and Kepler is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding SLC Agrcola SA and Kepler Weber SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kepler Weber SA and SLC Agrcola 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 SLC Agrcola SA are associated (or correlated) with Kepler Weber. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kepler Weber SA has no effect on the direction of SLC Agrcola i.e., SLC Agrcola and Kepler Weber go up and down completely randomly.

Pair Corralation between SLC Agrcola and Kepler Weber

Assuming the 90 days trading horizon SLC Agrcola SA is expected to generate 0.81 times more return on investment than Kepler Weber. However, SLC Agrcola SA is 1.24 times less risky than Kepler Weber. It trades about 0.12 of its potential returns per unit of risk. Kepler Weber SA is currently generating about -0.05 per unit of risk. If you would invest  1,721  in SLC Agrcola SA on September 13, 2024 and sell it today you would earn a total of  194.00  from holding SLC Agrcola SA or generate 11.27% return on investment over 90 days.

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

SLC Agrcola SA  vs.  Kepler Weber SA

SLC Agrcola SA

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in SLC Agrcola SA are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, SLC Agrcola may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Kepler Weber SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kepler Weber SA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest uncertain performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Pair Trading with SLC Agrcola and Kepler Weber

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

The idea behind SLC Agrcola SA and Kepler Weber SA 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.