Correlation Between Kaltura and Vistra Energy

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

By analyzing existing cross correlation between Kaltura and Vistra Energy Corp, you can compare the effects of market volatilities on Kaltura and Vistra Energy 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 Vistra Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaltura and Vistra Energy.

Diversification Opportunities for Kaltura and Vistra Energy

0.77

Correlation Coefficient

Kaltura  Vistra Energy

Poor diversification

The 3 months correlation between Kaltura and Vistra is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Kaltura and Vistra Energy Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vistra Energy Corp 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 Vistra Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vistra Energy Corp has no effect on the direction of Kaltura i.e., Kaltura and Vistra Energy go up and down completely randomly.

Pair Corralation between Kaltura and Vistra Energy

Given the investment horizon of 90 days Kaltura is expected to generate 1.08 times more return on investment than Vistra Energy. However, Kaltura is 1.08 times more volatile than Vistra Energy Corp. It trades about 0.28 of its potential returns per unit of risk. Vistra Energy Corp is currently generating about 0.29 per unit of risk. If you would invest  111.00  in Kaltura on September 4, 2024 and sell it today you would earn a total of  114.00  from holding Kaltura or generate 102.7% return on investment over 90 days.

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

Kaltura  vs.  Vistra Energy Corp

Kaltura

Risk-Adjusted Performance

21 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Kaltura are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Kaltura reported solid returns over the last few months and may actually be approaching a breakup point.

Vistra Energy Corp

Risk-Adjusted Performance

22 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Vistra Energy Corp are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Vistra Energy unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kaltura and Vistra Energy

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

The idea behind Kaltura and Vistra Energy Corp 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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.