Correlation Between KINGBOARD CHEMICAL and MOWI ASA

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

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

Diversification Opportunities for KINGBOARD CHEMICAL and MOWI ASA

0.0

Correlation Coefficient

KINGBOARD CHEMICAL  MOWI ASA

Pay attention - limited upside

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

Pair Corralation between KINGBOARD CHEMICAL and MOWI ASA

If you would invest  196.00  in KINGBOARD CHEMICAL on October 7, 2024 and sell it today you would earn a total of  30.00  from holding KINGBOARD CHEMICAL or generate 15.31% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	2.56%
Values	Daily Returns

KINGBOARD CHEMICAL  vs.  MOWI ASA SPADR

KINGBOARD CHEMICAL

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in KINGBOARD CHEMICAL are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, KINGBOARD CHEMICAL may actually be approaching a critical reversion point that can send shares even higher in February 2025.

MOWI ASA SPADR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MOWI ASA SPADR has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, MOWI ASA is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with KINGBOARD CHEMICAL and MOWI ASA

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

The idea behind KINGBOARD CHEMICAL and MOWI ASA SPADR 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.