Correlation Between Kancera AB and Mavshack Publ

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

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

Diversification Opportunities for Kancera AB and Mavshack Publ

-0.32

Correlation Coefficient

Kancera AB  Mavshack Publ

Very good diversification

The 3 months correlation between Kancera and Mavshack is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Kancera AB and Mavshack publ AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mavshack publ AB and Kancera AB 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 Kancera AB are associated (or correlated) with Mavshack Publ. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mavshack publ AB has no effect on the direction of Kancera AB i.e., Kancera AB and Mavshack Publ go up and down completely randomly.

Pair Corralation between Kancera AB and Mavshack Publ

Assuming the 90 days trading horizon Kancera AB is expected to under-perform the Mavshack Publ. But the stock apears to be less risky and, when comparing its historical volatility, Kancera AB is 2.86 times less risky than Mavshack Publ. The stock trades about -0.01 of its potential returns per unit of risk. The Mavshack publ AB is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest  3.00  in Mavshack publ AB on December 1, 2024 and sell it today you would lose (0.60) from holding Mavshack publ AB or give up 20.0% of portfolio value over 90 days.

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

Kancera AB  vs.  Mavshack publ AB

Kancera AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kancera AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Kancera AB is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Mavshack publ AB

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Mavshack publ AB are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Mavshack Publ may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Kancera AB and Mavshack Publ

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

The idea behind Kancera AB and Mavshack publ AB 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.