Correlation Between Kambi Group and SBB-B

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

By analyzing existing cross correlation between Kambi Group PLC and Samhllsbyggnadsbolaget i Norden, you can compare the effects of market volatilities on Kambi Group and SBB-B 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 Kambi Group with a short position of SBB-B. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kambi Group and SBB-B.

Diversification Opportunities for Kambi Group and SBB-B

0.8

Correlation Coefficient

Kambi Group  SBB-B

Very poor diversification

The 3 months correlation between Kambi and SBB-B is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Kambi Group PLC and Samhllsbyggnadsbolaget i Norde in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samhllsbyggnadsbolaget and Kambi Group 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 Kambi Group PLC are associated (or correlated) with SBB-B. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samhllsbyggnadsbolaget has no effect on the direction of Kambi Group i.e., Kambi Group and SBB-B go up and down completely randomly.

Pair Corralation between Kambi Group and SBB-B

Assuming the 90 days trading horizon Kambi Group is expected to generate 3.67 times less return on investment than SBB-B. But when comparing it to its historical volatility, Kambi Group PLC is 2.15 times less risky than SBB-B. It trades about 0.03 of its potential returns per unit of risk. Samhllsbyggnadsbolaget i Norden is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  374.00  in Samhllsbyggnadsbolaget i Norden on December 1, 2024 and sell it today you would earn a total of  36.00  from holding Samhllsbyggnadsbolaget i Norden or generate 9.63% return on investment over 90 days.

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

Kambi Group PLC  vs.  Samhllsbyggnadsbolaget i Norde

Kambi Group PLC

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Kambi Group PLC are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, Kambi Group is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Samhllsbyggnadsbolaget

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Samhllsbyggnadsbolaget i Norden are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, SBB-B unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kambi Group and SBB-B

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

The idea behind Kambi Group PLC and Samhllsbyggnadsbolaget i Norden 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..