Correlation Between Kingsway Financial and SmartSet Automation

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

By analyzing existing cross correlation between Kingsway Financial Services and SmartSet Automation LLC, you can compare the effects of market volatilities on Kingsway Financial and SmartSet Automation 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 Kingsway Financial with a short position of SmartSet Automation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kingsway Financial and SmartSet Automation.

Diversification Opportunities for Kingsway Financial and SmartSet Automation

0.25

Correlation Coefficient

Kingsway Financial  SmartSet Automation

Modest diversification

The 3 months correlation between Kingsway and SmartSet is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Kingsway Financial Services and SmartSet Automation LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SmartSet Automation LLC and Kingsway Financial 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 Kingsway Financial Services are associated (or correlated) with SmartSet Automation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SmartSet Automation LLC has no effect on the direction of Kingsway Financial i.e., Kingsway Financial and SmartSet Automation go up and down completely randomly.

Pair Corralation between Kingsway Financial and SmartSet Automation

Considering the 90-day investment horizon Kingsway Financial is expected to generate 5.9 times less return on investment than SmartSet Automation. But when comparing it to its historical volatility, Kingsway Financial Services is 5.4 times less risky than SmartSet Automation. It trades about 0.09 of its potential returns per unit of risk. SmartSet Automation LLC is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  0.13  in SmartSet Automation LLC on May 24, 2025 and sell it today you would earn a total of  0.03  from holding SmartSet Automation LLC or generate 23.08% return on investment over 90 days.

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

Kingsway Financial Services  vs.  SmartSet Automation LLC

Kingsway Financial

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in Kingsway Financial Services are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile technical and fundamental indicators, Kingsway Financial unveiled solid returns over the last few months and may actually be approaching a breakup point.

SmartSet Automation LLC

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in SmartSet Automation LLC are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile fundamental indicators, SmartSet Automation exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kingsway Financial and SmartSet Automation

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

The idea behind Kingsway Financial Services and SmartSet Automation LLC 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.