Correlation Between Kinaxis and American Financial
Can any of the company-specific risk be diversified away by investing in both Kinaxis and American Financial 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 Kinaxis and American Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinaxis and American Financial Group, you can compare the effects of market volatilities on Kinaxis and American Financial 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 Kinaxis with a short position of American Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinaxis and American Financial.
Diversification Opportunities for Kinaxis and American Financial
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kinaxis and American is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Kinaxis and American Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Financial and Kinaxis 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 Kinaxis are associated (or correlated) with American Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Financial has no effect on the direction of Kinaxis i.e., Kinaxis and American Financial go up and down completely randomly.
Pair Corralation between Kinaxis and American Financial
Assuming the 90 days trading horizon Kinaxis is expected to generate 1.22 times more return on investment than American Financial. However, Kinaxis is 1.22 times more volatile than American Financial Group. It trades about 0.04 of its potential returns per unit of risk. American Financial Group is currently generating about -0.11 per unit of risk. If you would invest 15,033 in Kinaxis on January 26, 2024 and sell it today you would earn a total of 138.00 from holding Kinaxis or generate 0.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinaxis vs. American Financial Group
Performance |
| Timeline |
| Kinaxis |
| American Financial |
Kinaxis and American Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinaxis and American Financial
The main advantage of trading using opposite Kinaxis and American Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinaxis position performs unexpectedly, American Financial 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 American Financial will offset losses from the drop in American Financial's long position.The idea behind Kinaxis and American Financial 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.| American Financial vs. Selective Insurance Group | American Financial vs. Horace Mann Educators | American Financial vs. Kemper | American Financial vs. ProAssurance |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |