Correlation Between Kibush Capital and NVIDIA

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Can any of the company-specific risk be diversified away by investing in both Kibush Capital and NVIDIA 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 Kibush Capital and NVIDIA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kibush Capital Corp and NVIDIA, you can compare the effects of market volatilities on Kibush Capital and NVIDIA 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 Kibush Capital with a short position of NVIDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kibush Capital and NVIDIA.

Diversification Opportunities for Kibush Capital and NVIDIA

  Correlation Coefficient

Very good diversification

The 3 months correlation between Kibush and NVIDIA is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Kibush Capital Corp and NVIDIA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NVIDIA and Kibush Capital 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 Kibush Capital Corp are associated (or correlated) with NVIDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NVIDIA has no effect on the direction of Kibush Capital i.e., Kibush Capital and NVIDIA go up and down completely randomly.

Pair Corralation between Kibush Capital and NVIDIA

Given the investment horizon of 90 days Kibush Capital Corp is expected to generate 3.96 times more return on investment than NVIDIA. However, Kibush Capital is 3.96 times more volatile than NVIDIA. It trades about 0.03 of its potential returns per unit of risk. NVIDIA is currently generating about 0.03 per unit of risk. If you would invest  0.25  in Kibush Capital Corp on September 7, 2022 and sell it today you would lose (0.22)  from holding Kibush Capital Corp or give up 88.0% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
ValuesDaily Returns

Kibush Capital Corp  vs.  NVIDIA

 Performance (%) 
Kibush Capital Corp 
Kibush Performance
1 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in Kibush Capital Corp are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Even with relatively unfluctuating fundamental indicators, Kibush Capital reported solid returns over the last few months and may actually be approaching a breakup point.

Kibush Price Channel

NVIDIA Performance
7 of 100
Compared to the overall equity markets, risk-adjusted returns on investments in NVIDIA are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat uncertain fundamental indicators, NVIDIA sustained solid returns over the last few months and may actually be approaching a breakup point.

NVIDIA Price Channel

Kibush Capital and NVIDIA Volatility Contrast

   Predicted Return Density   

Pair Trading with Kibush Capital and NVIDIA

The main advantage of trading using opposite Kibush Capital and NVIDIA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kibush Capital position performs unexpectedly, NVIDIA 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 NVIDIA will offset losses from the drop in NVIDIA's long position.
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The idea behind Kibush Capital Corp and NVIDIA 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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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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.

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