Correlation Between Knights Group and Db X

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

By analyzing existing cross correlation between Knights Group Holdings and db x trackers MSCI, you can compare the effects of market volatilities on Knights Group and Db X 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 Knights Group with a short position of Db X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Knights Group and Db X.

Diversification Opportunities for Knights Group and Db X

0.0

Correlation Coefficient

Knights Group  Db X

Pay attention - limited upside

The 3 months correlation between Knights and XWLD is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Knights Group Holdings and db x trackers MSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on db x trackers and Knights 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 Knights Group Holdings are associated (or correlated) with Db X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of db x trackers has no effect on the direction of Knights Group i.e., Knights Group and Db X go up and down completely randomly.

Pair Corralation between Knights Group and Db X

If you would invest  10,950  in Knights Group Holdings on December 22, 2024 and sell it today you would earn a total of  3,250  from holding Knights Group Holdings or generate 29.68% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.61%
Values	Daily Returns

Knights Group Holdings  vs.  db x trackers MSCI

Knights Group Holdings

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Knights Group Holdings are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain technical and fundamental indicators, Knights Group exhibited solid returns over the last few months and may actually be approaching a breakup point.

db x trackers

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Knights Group and Db X

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

The idea behind Knights Group Holdings and db x trackers MSCI 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 Global Correlations module to find global opportunities by holding instruments from different markets.