Correlation Between Kiaro Holdings and Allstar Health

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

By analyzing existing cross correlation between Kiaro Holdings Corp and Allstar Health Brands, you can compare the effects of market volatilities on Kiaro Holdings and Allstar Health 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 Kiaro Holdings with a short position of Allstar Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kiaro Holdings and Allstar Health.

Diversification Opportunities for Kiaro Holdings and Allstar Health

0.07

Correlation Coefficient

Kiaro Holdings  Allstar Health

Significant diversification

The 3 months correlation between Kiaro and Allstar is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Kiaro Holdings Corp and Allstar Health Brands in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allstar Health Brands and Kiaro Holdings 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 Kiaro Holdings Corp are associated (or correlated) with Allstar Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allstar Health Brands has no effect on the direction of Kiaro Holdings i.e., Kiaro Holdings and Allstar Health go up and down completely randomly.

Pair Corralation between Kiaro Holdings and Allstar Health

Assuming the 90 days horizon Kiaro Holdings Corp is expected to under-perform the Allstar Health. In addition to that, Kiaro Holdings is 1.14 times more volatile than Allstar Health Brands. It trades about -0.13 of its total potential returns per unit of risk. Allstar Health Brands is currently generating about 0.0 per unit of volatility. If you would invest  0.06  in Allstar Health Brands on December 29, 2024 and sell it today you would lose (0.02) from holding Allstar Health Brands or give up 33.33% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	96.77%
Values	Daily Returns

Kiaro Holdings Corp  vs.  Allstar Health Brands

Kiaro Holdings Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kiaro Holdings Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Allstar Health Brands

Risk-Adjusted Performance

Very Weak

Over the last 90 days Allstar Health Brands has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Allstar Health 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 Kiaro Holdings and Allstar Health

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

The idea behind Kiaro Holdings Corp and Allstar Health Brands 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.