Correlation Between 4Mass SA and Grupa KTY

Can any of the company-specific risk be diversified away by investing in both 4Mass SA and Grupa KTY 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 4Mass SA and Grupa KTY into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between 4Mass SA and Grupa KTY SA, you can compare the effects of market volatilities on 4Mass SA and Grupa KTY 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 4Mass SA with a short position of Grupa KTY. Check out your portfolio center. Please also check ongoing floating volatility patterns of 4Mass SA and Grupa KTY.

Diversification Opportunities for 4Mass SA and Grupa KTY

-0.47

Correlation Coefficient

4Mass SA  Grupa KTY

Very good diversification

The 3 months correlation between 4Mass and Grupa is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding 4Mass SA and Grupa KTY SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupa KTY SA and 4Mass SA 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 4Mass SA are associated (or correlated) with Grupa KTY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupa KTY SA has no effect on the direction of 4Mass SA i.e., 4Mass SA and Grupa KTY go up and down completely randomly.

Pair Corralation between 4Mass SA and Grupa KTY

Assuming the 90 days trading horizon 4Mass SA is expected to generate 1.67 times more return on investment than Grupa KTY. However, 4Mass SA is 1.67 times more volatile than Grupa KTY SA. It trades about 0.09 of its potential returns per unit of risk. Grupa KTY SA is currently generating about 0.08 per unit of risk. If you would invest  224.00  in 4Mass SA on September 14, 2024 and sell it today you would earn a total of  422.00  from holding 4Mass SA or generate 188.39% return on investment over 90 days.

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

4Mass SA  vs.  Grupa KTY SA

4Mass SA

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in 4Mass SA are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, 4Mass SA may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Grupa KTY SA

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Grupa KTY SA has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest weak performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

Pair Trading with 4Mass SA and Grupa KTY

The main advantage of trading using opposite 4Mass SA and Grupa KTY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 4Mass SA position performs unexpectedly, Grupa KTY 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 Grupa KTY will offset losses from the drop in Grupa KTY's long position.

The idea behind 4Mass SA and Grupa KTY SA 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.

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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.