Correlation Between Konfoong Materials and Grandblue Environment

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Can any of the company-specific risk be diversified away by investing in both Konfoong Materials and Grandblue Environment 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 Konfoong Materials and Grandblue Environment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Konfoong Materials International and Grandblue Environment Co, you can compare the effects of market volatilities on Konfoong Materials and Grandblue Environment 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 Konfoong Materials with a short position of Grandblue Environment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Konfoong Materials and Grandblue Environment.

Diversification Opportunities for Konfoong Materials and Grandblue Environment

-0.25
  Correlation Coefficient

Very good diversification

The 3 months correlation between Konfoong and Grandblue is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Konfoong Materials Internation and Grandblue Environment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grandblue Environment and Konfoong Materials 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 Konfoong Materials International are associated (or correlated) with Grandblue Environment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grandblue Environment has no effect on the direction of Konfoong Materials i.e., Konfoong Materials and Grandblue Environment go up and down completely randomly.

Pair Corralation between Konfoong Materials and Grandblue Environment

Assuming the 90 days trading horizon Konfoong Materials International is expected to generate 1.63 times more return on investment than Grandblue Environment. However, Konfoong Materials is 1.63 times more volatile than Grandblue Environment Co. It trades about -0.03 of its potential returns per unit of risk. Grandblue Environment Co is currently generating about -0.09 per unit of risk. If you would invest  7,255  in Konfoong Materials International on October 26, 2024 and sell it today you would lose (156.00) from holding Konfoong Materials International or give up 2.15% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Konfoong Materials Internation  vs.  Grandblue Environment Co

 Performance 
       Timeline  
Konfoong Materials 

Risk-Adjusted Performance

2 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Konfoong Materials International are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Konfoong Materials may actually be approaching a critical reversion point that can send shares even higher in February 2025.
Grandblue Environment 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Grandblue Environment Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Grandblue Environment is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Konfoong Materials and Grandblue Environment Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Konfoong Materials and Grandblue Environment

The main advantage of trading using opposite Konfoong Materials and Grandblue Environment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Konfoong Materials position performs unexpectedly, Grandblue Environment 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 Grandblue Environment will offset losses from the drop in Grandblue Environment's long position.
The idea behind Konfoong Materials International and Grandblue Environment 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.

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