Correlation Between Kaltura and Transportadora

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

By analyzing existing cross correlation between Kaltura and Transportadora de Gas, you can compare the effects of market volatilities on Kaltura and Transportadora 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 Kaltura with a short position of Transportadora. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaltura and Transportadora.

Diversification Opportunities for Kaltura and Transportadora

0.94

Correlation Coefficient

Kaltura  Transportadora

Almost no diversification

The 3 months correlation between Kaltura and Transportadora is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Kaltura and Transportadora de Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transportadora de Gas and Kaltura 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 Kaltura are associated (or correlated) with Transportadora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transportadora de Gas has no effect on the direction of Kaltura i.e., Kaltura and Transportadora go up and down completely randomly.

Pair Corralation between Kaltura and Transportadora

Given the investment horizon of 90 days Kaltura is expected to generate 1.68 times more return on investment than Transportadora. However, Kaltura is 1.68 times more volatile than Transportadora de Gas. It trades about 0.2 of its potential returns per unit of risk. Transportadora de Gas is currently generating about 0.2 per unit of risk. If you would invest  112.00  in Kaltura on October 3, 2024 and sell it today you would earn a total of  108.00  from holding Kaltura or generate 96.43% return on investment over 90 days.

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

Kaltura  vs.  Transportadora de Gas

Kaltura

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Kaltura are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating basic indicators, Kaltura reported solid returns over the last few months and may actually be approaching a breakup point.

Transportadora de Gas

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Transportadora de Gas are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak technical and fundamental indicators, Transportadora unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kaltura and Transportadora

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

The idea behind Kaltura and Transportadora de Gas 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.

Check out your portfolio center.

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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.