Correlation Between Aldel Financial and Kaltura

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

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

Diversification Opportunities for Aldel Financial and Kaltura

-0.48

Correlation Coefficient

Aldel Financial  Kaltura

Very good diversification

The 3 months correlation between Aldel and Kaltura is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Aldel Financial II and Kaltura in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kaltura and Aldel Financial 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 Aldel Financial II are associated (or correlated) with Kaltura. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kaltura has no effect on the direction of Aldel Financial i.e., Aldel Financial and Kaltura go up and down completely randomly.

Pair Corralation between Aldel Financial and Kaltura

Assuming the 90 days horizon Aldel Financial is expected to generate 91.07 times less return on investment than Kaltura. But when comparing it to its historical volatility, Aldel Financial II is 39.32 times less risky than Kaltura. It trades about 0.1 of its potential returns per unit of risk. Kaltura is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest  129.00  in Kaltura on September 17, 2024 and sell it today you would earn a total of  96.00  from holding Kaltura or generate 74.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	60.0%
Values	Daily Returns

Aldel Financial II  vs.  Kaltura

Aldel Financial II

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Aldel Financial II are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable technical and fundamental indicators, Aldel Financial is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Kaltura

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Kaltura are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Even with relatively abnormal basic indicators, Kaltura reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Aldel Financial and Kaltura

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

The idea behind Aldel Financial II and Kaltura 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 Anywhere module to track or share privately all of your investments from the convenience of any device.