Correlation Between KHVATEC CoLtd and Intops

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

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

Diversification Opportunities for KHVATEC CoLtd and Intops

0.96

Correlation Coefficient

KHVATEC CoLtd  Intops

Almost no diversification

The 3 months correlation between KHVATEC and Intops is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding KHVATEC CoLtd and Intops Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intops and KHVATEC CoLtd 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 KHVATEC CoLtd are associated (or correlated) with Intops. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intops has no effect on the direction of KHVATEC CoLtd i.e., KHVATEC CoLtd and Intops go up and down completely randomly.

Pair Corralation between KHVATEC CoLtd and Intops

Assuming the 90 days trading horizon KHVATEC CoLtd is expected to generate 2.03 times less return on investment than Intops. But when comparing it to its historical volatility, KHVATEC CoLtd is 1.71 times less risky than Intops. It trades about 0.26 of its potential returns per unit of risk. Intops Co is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest  1,503,222  in Intops Co on October 9, 2024 and sell it today you would earn a total of  403,778  from holding Intops Co or generate 26.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

KHVATEC CoLtd  vs.  Intops Co

KHVATEC CoLtd

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KHVATEC CoLtd has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Intops

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Intops Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with KHVATEC CoLtd and Intops

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

The idea behind KHVATEC CoLtd and Intops Co 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.