Correlation Between Kontrol Technologies and Nagarro SE

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

By analyzing existing cross correlation between Kontrol Technologies Corp and Nagarro SE, you can compare the effects of market volatilities on Kontrol Technologies and Nagarro SE 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 Kontrol Technologies with a short position of Nagarro SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kontrol Technologies and Nagarro SE.

Diversification Opportunities for Kontrol Technologies and Nagarro SE

-0.14

Correlation Coefficient

Kontrol Technologies  Nagarro SE

Good diversification

The 3 months correlation between Kontrol and Nagarro is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Kontrol Technologies Corp and Nagarro SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nagarro SE and Kontrol Technologies 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 Kontrol Technologies Corp are associated (or correlated) with Nagarro SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nagarro SE has no effect on the direction of Kontrol Technologies i.e., Kontrol Technologies and Nagarro SE go up and down completely randomly.

Pair Corralation between Kontrol Technologies and Nagarro SE

Assuming the 90 days horizon Kontrol Technologies Corp is expected to under-perform the Nagarro SE. In addition to that, Kontrol Technologies is 1.97 times more volatile than Nagarro SE. It trades about -0.03 of its total potential returns per unit of risk. Nagarro SE is currently generating about 0.0 per unit of volatility. If you would invest  8,421  in Nagarro SE on December 29, 2024 and sell it today you would lose (209.00) from holding Nagarro SE or give up 2.48% of portfolio value over 90 days.

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

Kontrol Technologies Corp  vs.  Nagarro SE

Kontrol Technologies Corp

Risk-Adjusted Performance

Weak

Over the last 90 days Kontrol Technologies Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Stock's essential indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

Nagarro SE

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Kontrol Technologies and Nagarro SE

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

The idea behind Kontrol Technologies Corp and Nagarro SE 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..