Correlation Between KYN Capital and Verde Bio

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

By analyzing existing cross correlation between KYN Capital Group and Verde Bio Holdings, you can compare the effects of market volatilities on KYN Capital and Verde Bio 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 KYN Capital with a short position of Verde Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of KYN Capital and Verde Bio.

Diversification Opportunities for KYN Capital and Verde Bio

0.0

Correlation Coefficient

KYN Capital  Verde Bio

Pay attention - limited upside

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

Pair Corralation between KYN Capital and Verde Bio

If you would invest  0.06  in KYN Capital Group on December 27, 2024 and sell it today you would lose (0.01) from holding KYN Capital Group or give up 16.67% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

KYN Capital Group  vs.  Verde Bio Holdings

KYN Capital Group

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in KYN Capital Group are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, KYN Capital exhibited solid returns over the last few months and may actually be approaching a breakup point.

Verde Bio Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Verde Bio Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong technical indicators, Verde Bio is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with KYN Capital and Verde Bio

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

The idea behind KYN Capital Group and Verde Bio Holdings 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.