Correlation Between Kongzhong Corp and Hasbro

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Can any of the company-specific risk be diversified away by investing in both Kongzhong Corp and Hasbro 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 Kongzhong Corp and Hasbro into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kongzhong Corp and Hasbro Inc, you can compare the effects of market volatilities on Kongzhong Corp and Hasbro 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 Kongzhong Corp with a short position of Hasbro. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kongzhong Corp and Hasbro.

Diversification Opportunities for Kongzhong Corp and Hasbro

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  Correlation Coefficient

Pay attention - limited upside

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

Pair Corralation between Kongzhong Corp and Hasbro

If you would invest  5,042  in Hasbro Inc on December 30, 2023 and sell it today you would earn a total of  610.00  from holding Hasbro Inc or generate 12.1% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

Kongzhong Corp  vs.  Hasbro Inc

 Performance 
       Timeline  
Kongzhong Corp 

Risk-Adjusted Performance

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Over the last 90 days Kongzhong Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Kongzhong Corp is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.
Hasbro Inc 

Risk-Adjusted Performance

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OK
Compared to the overall equity markets, risk-adjusted returns on investments in Hasbro Inc are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Hasbro unveiled solid returns over the last few months and may actually be approaching a breakup point.

Kongzhong Corp and Hasbro Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Kongzhong Corp and Hasbro

The main advantage of trading using opposite Kongzhong Corp and Hasbro positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kongzhong Corp position performs unexpectedly, Hasbro 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 Hasbro will offset losses from the drop in Hasbro's long position.
The idea behind Kongzhong Corp and Hasbro Inc 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.

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