Correlation Between Evolution and Kambi Group

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

By analyzing existing cross correlation between Evolution AB and Kambi Group PLC, you can compare the effects of market volatilities on Evolution and Kambi Group 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 Evolution with a short position of Kambi Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Evolution and Kambi Group.

Diversification Opportunities for Evolution and Kambi Group

0.57

Correlation Coefficient

Evolution  Kambi Group

Very weak diversification

The 3 months correlation between Evolution and Kambi is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Evolution AB and Kambi Group PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kambi Group PLC and Evolution 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 Evolution AB are associated (or correlated) with Kambi Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kambi Group PLC has no effect on the direction of Evolution i.e., Evolution and Kambi Group go up and down completely randomly.

Pair Corralation between Evolution and Kambi Group

Assuming the 90 days trading horizon Evolution is expected to generate 1.3 times less return on investment than Kambi Group. In addition to that, Evolution is 1.35 times more volatile than Kambi Group PLC. It trades about 0.06 of its total potential returns per unit of risk. Kambi Group PLC is currently generating about 0.1 per unit of volatility. If you would invest  11,810  in Kambi Group PLC on April 24, 2025 and sell it today you would earn a total of  1,550  from holding Kambi Group PLC or generate 13.12% return on investment over 90 days.

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

Evolution AB  vs.  Kambi Group PLC

Evolution AB

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Evolution AB are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Evolution may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Kambi Group PLC

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kambi Group PLC are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, Kambi Group unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Evolution and Kambi Group

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

The idea behind Evolution AB and Kambi Group PLC 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.