Correlation Between Ingentec and Kinsus Interconnect

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

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

Diversification Opportunities for Ingentec and Kinsus Interconnect

0.77

Correlation Coefficient

Ingentec  Kinsus Interconnect

Poor diversification

The 3 months correlation between Ingentec and Kinsus is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Ingentec and Kinsus Interconnect Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinsus Interconnect and Ingentec 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 Ingentec are associated (or correlated) with Kinsus Interconnect. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinsus Interconnect has no effect on the direction of Ingentec i.e., Ingentec and Kinsus Interconnect go up and down completely randomly.

Pair Corralation between Ingentec and Kinsus Interconnect

Assuming the 90 days trading horizon Ingentec is expected to generate 1.25 times more return on investment than Kinsus Interconnect. However, Ingentec is 1.25 times more volatile than Kinsus Interconnect Technology. It trades about 0.04 of its potential returns per unit of risk. Kinsus Interconnect Technology is currently generating about 0.01 per unit of risk. If you would invest  13,183  in Ingentec on September 28, 2024 and sell it today you would earn a total of  4,417  from holding Ingentec or generate 33.51% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	99.79%
Values	Daily Returns

Ingentec  vs.  Kinsus Interconnect Technology

Ingentec

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Ingentec has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in January 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Kinsus Interconnect

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kinsus Interconnect Technology has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Kinsus Interconnect is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Ingentec and Kinsus Interconnect

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

The idea behind Ingentec and Kinsus Interconnect Technology 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.