Correlation Between Mynaric AG and KULR Technology

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

By analyzing existing cross correlation between Mynaric AG ADR and KULR Technology Group, you can compare the effects of market volatilities on Mynaric AG and KULR Technology 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 Mynaric AG with a short position of KULR Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mynaric AG and KULR Technology.

Diversification Opportunities for Mynaric AG and KULR Technology

-0.68

Correlation Coefficient

Mynaric AG  KULR Technology

Excellent diversification

The 3 months correlation between Mynaric and KULR is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Mynaric AG ADR and KULR Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KULR Technology Group and Mynaric AG 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 Mynaric AG ADR are associated (or correlated) with KULR Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KULR Technology Group has no effect on the direction of Mynaric AG i.e., Mynaric AG and KULR Technology go up and down completely randomly.

Pair Corralation between Mynaric AG and KULR Technology

Given the investment horizon of 90 days Mynaric AG ADR is expected to under-perform the KULR Technology. But the stock apears to be less risky and, when comparing its historical volatility, Mynaric AG ADR is 1.23 times less risky than KULR Technology. The stock trades about -0.03 of its potential returns per unit of risk. The KULR Technology Group is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest  29.00  in KULR Technology Group on October 23, 2024 and sell it today you would earn a total of  199.00  from holding KULR Technology Group or generate 686.21% return on investment over 90 days.

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

Mynaric AG ADR  vs.  KULR Technology Group

Mynaric AG ADR

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mynaric AG ADR has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

KULR Technology Group

Risk-Adjusted Performance

21 of 100

Solid

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

Pair Trading with Mynaric AG and KULR Technology

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

The idea behind Mynaric AG ADR and KULR Technology Group 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.