Correlation Between Ion Beam and Kinepolis Group

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

By analyzing existing cross correlation between Ion Beam Applications and Kinepolis Group NV, you can compare the effects of market volatilities on Ion Beam and Kinepolis Group 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 Ion Beam with a short position of Kinepolis Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ion Beam and Kinepolis Group.

Diversification Opportunities for Ion Beam and Kinepolis Group

0.61

Correlation Coefficient

Ion Beam  Kinepolis Group

Poor diversification

The 3 months correlation between Ion and Kinepolis is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Ion Beam Applications and Kinepolis Group NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinepolis Group NV and Ion Beam 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 Ion Beam Applications are associated (or correlated) with Kinepolis Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinepolis Group NV has no effect on the direction of Ion Beam i.e., Ion Beam and Kinepolis Group go up and down completely randomly.

Pair Corralation between Ion Beam and Kinepolis Group

Assuming the 90 days trading horizon Ion Beam Applications is expected to under-perform the Kinepolis Group. In addition to that, Ion Beam is 1.4 times more volatile than Kinepolis Group NV. It trades about -0.11 of its total potential returns per unit of risk. Kinepolis Group NV is currently generating about -0.15 per unit of volatility. If you would invest  3,885  in Kinepolis Group NV on December 30, 2024 and sell it today you would lose (580.00) from holding Kinepolis Group NV or give up 14.93% of portfolio value over 90 days.

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

Ion Beam Applications  vs.  Kinepolis Group NV

Ion Beam Applications

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ion Beam Applications has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Kinepolis Group NV

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kinepolis Group NV has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Stock's basic indicators remain relatively invariable which may send shares a bit higher in April 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with Ion Beam and Kinepolis Group

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

The idea behind Ion Beam Applications and Kinepolis Group NV 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.