Correlation Between VCI Global and Kelly Services

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

By analyzing existing cross correlation between VCI Global Limited and Kelly Services B, you can compare the effects of market volatilities on VCI Global and Kelly Services 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 VCI Global with a short position of Kelly Services. Check out your portfolio center. Please also check ongoing floating volatility patterns of VCI Global and Kelly Services.

Diversification Opportunities for VCI Global and Kelly Services

0.76

Correlation Coefficient

VCI Global  Kelly Services

Poor diversification

The 3 months correlation between VCI and Kelly is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding VCI Global Limited and Kelly Services B in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kelly Services B and VCI Global 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 VCI Global Limited are associated (or correlated) with Kelly Services. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kelly Services B has no effect on the direction of VCI Global i.e., VCI Global and Kelly Services go up and down completely randomly.

Pair Corralation between VCI Global and Kelly Services

Given the investment horizon of 90 days VCI Global Limited is expected to generate 15.18 times more return on investment than Kelly Services. However, VCI Global is 15.18 times more volatile than Kelly Services B. It trades about 0.02 of its potential returns per unit of risk. Kelly Services B is currently generating about 0.01 per unit of risk. If you would invest  20,824  in VCI Global Limited on September 4, 2024 and sell it today you would lose (20,506) from holding VCI Global Limited or give up 98.47% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	83.81%
Values	Daily Returns

VCI Global Limited  vs.  Kelly Services B

VCI Global Limited

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VCI Global Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable forward indicators, VCI Global is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Kelly Services B

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kelly Services B has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with VCI Global and Kelly Services

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

The idea behind VCI Global Limited and Kelly Services B 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.