Correlation Between Kellanova and SAIHEAT

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

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

Diversification Opportunities for Kellanova and SAIHEAT

-0.15

Correlation Coefficient

Kellanova  SAIHEAT

Good diversification

The 3 months correlation between Kellanova and SAIHEAT is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Kellanova and SAIHEAT Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAIHEAT Limited and Kellanova 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 Kellanova are associated (or correlated) with SAIHEAT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAIHEAT Limited has no effect on the direction of Kellanova i.e., Kellanova and SAIHEAT go up and down completely randomly.

Pair Corralation between Kellanova and SAIHEAT

Taking into account the 90-day investment horizon Kellanova is expected to generate 78.99 times less return on investment than SAIHEAT. But when comparing it to its historical volatility, Kellanova is 129.77 times less risky than SAIHEAT. It trades about 0.28 of its potential returns per unit of risk. SAIHEAT Limited is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest  9.15  in SAIHEAT Limited on December 20, 2024 and sell it today you would earn a total of  3.85  from holding SAIHEAT Limited or generate 42.08% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	40.68%
Values	Daily Returns

Kellanova  vs.  SAIHEAT Limited

Kellanova

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Kellanova are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite quite persistent forward-looking signals, Kellanova is not utilizing all of its potentials. The current stock price mess, may contribute to short-term losses for the institutional investors.

SAIHEAT Limited

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SAIHEAT Limited are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak technical indicators, SAIHEAT showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kellanova and SAIHEAT

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

The idea behind Kellanova and SAIHEAT Limited 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.

Check out your portfolio center.

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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.