Correlation Between Implenia and Kardex

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

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

Diversification Opportunities for Implenia and Kardex

0.87

Correlation Coefficient

Implenia  Kardex

Very poor diversification

The 3 months correlation between Implenia and Kardex is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Implenia AG and Kardex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kardex and Implenia 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 Implenia AG are associated (or correlated) with Kardex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kardex has no effect on the direction of Implenia i.e., Implenia and Kardex go up and down completely randomly.

Pair Corralation between Implenia and Kardex

Assuming the 90 days trading horizon Implenia is expected to generate 2.49 times less return on investment than Kardex. In addition to that, Implenia is 1.38 times more volatile than Kardex. It trades about 0.14 of its total potential returns per unit of risk. Kardex is currently generating about 0.49 per unit of volatility. If you would invest  19,900  in Kardex on April 25, 2025 and sell it today you would earn a total of  10,600  from holding Kardex or generate 53.27% return on investment over 90 days.

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

Implenia AG  vs.  Kardex

Implenia AG

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Implenia AG are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Implenia showed solid returns over the last few months and may actually be approaching a breakup point.

Kardex

Risk-Adjusted Performance

Very Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Kardex are ranked lower than 38 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Kardex showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Implenia and Kardex

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

The idea behind Implenia AG and Kardex 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.