Correlation Between Alucon Public and K W

Can any of the company-specific risk be diversified away by investing in both Alucon Public and K W 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 Alucon Public and K W into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Alucon Public and K W Metal, you can compare the effects of market volatilities on Alucon Public and K W 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 Alucon Public with a short position of K W. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alucon Public and K W.

Diversification Opportunities for Alucon Public and K W

-0.43

Correlation Coefficient

Alucon Public  K W

Very good diversification

The 3 months correlation between Alucon and KWM is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Alucon Public and K W Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on K W Metal and Alucon Public 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 Alucon Public are associated (or correlated) with K W. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of K W Metal has no effect on the direction of Alucon Public i.e., Alucon Public and K W go up and down completely randomly.

Pair Corralation between Alucon Public and K W

Assuming the 90 days trading horizon Alucon Public is expected to generate 0.3 times more return on investment than K W. However, Alucon Public is 3.33 times less risky than K W. It trades about 0.19 of its potential returns per unit of risk. K W Metal is currently generating about -0.03 per unit of risk. If you would invest  16,763  in Alucon Public on April 24, 2025 and sell it today you would earn a total of  1,037  from holding Alucon Public or generate 6.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.31%
Values	Daily Returns

Alucon Public  vs.  K W Metal

Alucon Public

Risk-Adjusted Performance

Good

Over the last 90 days Alucon Public has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat weak basic indicators, Alucon Public may actually be approaching a critical reversion point that can send shares even higher in August 2025.

K W Metal

Risk-Adjusted Performance

Very Weak

Over the last 90 days K W Metal has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent primary indicators, K W is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Pair Trading with Alucon Public and K W

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

The idea behind Alucon Public and K W Metal 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.