Correlation Between Boswell J and KS AG

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

By analyzing existing cross correlation between Boswell J G and KS AG DRC, you can compare the effects of market volatilities on Boswell J and KS AG 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 Boswell J with a short position of KS AG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boswell J and KS AG.

Diversification Opportunities for Boswell J and KS AG

-0.21

Correlation Coefficient

Boswell J  KS AG

Very good diversification

The 3 months correlation between Boswell and KPLUY is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Boswell J G and KS AG DRC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KS AG DRC and Boswell J 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 Boswell J G are associated (or correlated) with KS AG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KS AG DRC has no effect on the direction of Boswell J i.e., Boswell J and KS AG go up and down completely randomly.

Pair Corralation between Boswell J and KS AG

Given the investment horizon of 90 days Boswell J G is expected to under-perform the KS AG. But the pink sheet apears to be less risky and, when comparing its historical volatility, Boswell J G is 2.35 times less risky than KS AG. The pink sheet trades about -0.22 of its potential returns per unit of risk. The KS AG DRC is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  701.00  in KS AG DRC on December 1, 2024 and sell it today you would lose (6.00) from holding KS AG DRC or give up 0.86% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Boswell J G  vs.  KS AG DRC

Boswell J G

Risk-Adjusted Performance

Very Weak

Over the last 90 days Boswell J G has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's technical and fundamental indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

KS AG DRC

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in KS AG DRC are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly fragile basic indicators, KS AG showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Boswell J and KS AG

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

The idea behind Boswell J G and KS AG DRC 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.