Correlation Between Kingold Jewelry and Estee Lauder
Can any of the company-specific risk be diversified away by investing in both Kingold Jewelry and Estee Lauder 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 Kingold Jewelry and Estee Lauder into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kingold Jewelry and Estee Lauder Companies, you can compare the effects of market volatilities on Kingold Jewelry and Estee Lauder 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 Kingold Jewelry with a short position of Estee Lauder. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kingold Jewelry and Estee Lauder.
Diversification Opportunities for Kingold Jewelry and Estee Lauder
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kingold and Estee is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding Kingold Jewelry and Estee Lauder Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Estee Lauder Companies and Kingold Jewelry 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 Kingold Jewelry are associated (or correlated) with Estee Lauder. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Estee Lauder Companies has no effect on the direction of Kingold Jewelry i.e., Kingold Jewelry and Estee Lauder go up and down completely randomly.
Pair Corralation between Kingold Jewelry and Estee Lauder
If you would invest 13,931 in Estee Lauder Companies on January 26, 2024 and sell it today you would earn a total of 805.00 from holding Estee Lauder Companies or generate 5.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
Kingold Jewelry vs. Estee Lauder Companies
Performance |
| Timeline |
| Kingold Jewelry |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Estee Lauder Companies |
Kingold Jewelry and Estee Lauder Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kingold Jewelry and Estee Lauder
The main advantage of trading using opposite Kingold Jewelry and Estee Lauder positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kingold Jewelry position performs unexpectedly, Estee Lauder 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 Estee Lauder will offset losses from the drop in Estee Lauder's long position.| Kingold Jewelry vs. Emerson Radio | Kingold Jewelry vs. Teleflex Incorporated | Kingold Jewelry vs. Cardinal Health | Kingold Jewelry vs. Playa Hotels Resorts |
| Estee Lauder vs. Colgate Palmolive | Estee Lauder vs. Honest Company | Estee Lauder vs. Hims Hers Health | Estee Lauder vs. European Wax Center |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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