Correlation Between Kneat and BICO Group

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

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

Diversification Opportunities for Kneat and BICO Group

-0.26

Correlation Coefficient

Kneat  BICO Group

Very good diversification

The 3 months correlation between Kneat and BICO is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Kneat Inc and BICO Group AB in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BICO Group AB and Kneat 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 Kneat Inc are associated (or correlated) with BICO Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BICO Group AB has no effect on the direction of Kneat i.e., Kneat and BICO Group go up and down completely randomly.

Pair Corralation between Kneat and BICO Group

Assuming the 90 days trading horizon Kneat Inc is expected to generate 0.73 times more return on investment than BICO Group. However, Kneat Inc is 1.37 times less risky than BICO Group. It trades about -0.02 of its potential returns per unit of risk. BICO Group AB is currently generating about -0.02 per unit of risk. If you would invest  609.00  in Kneat Inc on April 23, 2025 and sell it today you would lose (22.00) from holding Kneat Inc or give up 3.61% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.83%
Values	Daily Returns

Kneat Inc  vs.  BICO Group AB

Kneat Inc

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kneat Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy forward indicators, Kneat is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

BICO Group AB

Risk-Adjusted Performance

Very Weak

Over the last 90 days BICO Group AB has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, BICO Group is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Kneat and BICO Group

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

The idea behind Kneat Inc and BICO Group AB 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.