Correlation Between Kamada and Charles River

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

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

Diversification Opportunities for Kamada and Charles River

0.77

Correlation Coefficient

Kamada  Charles River

Poor diversification

The 3 months correlation between Kamada and Charles is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Kamada and Charles River Laboratories in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Charles River Labora and Kamada 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 Kamada are associated (or correlated) with Charles River. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Charles River Labora has no effect on the direction of Kamada i.e., Kamada and Charles River go up and down completely randomly.

Pair Corralation between Kamada and Charles River

Given the investment horizon of 90 days Kamada is expected to generate 4.2 times less return on investment than Charles River. But when comparing it to its historical volatility, Kamada is 1.53 times less risky than Charles River. It trades about 0.06 of its potential returns per unit of risk. Charles River Laboratories is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest  11,944  in Charles River Laboratories on May 4, 2025 and sell it today you would earn a total of  4,747  from holding Charles River Laboratories or generate 39.74% return on investment over 90 days.

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

Kamada  vs.  Charles River Laboratories

Kamada

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Kamada are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating fundamental indicators, Kamada may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Charles River Labora

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Charles River Laboratories are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite quite abnormal basic indicators, Charles River disclosed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Kamada and Charles River

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

The idea behind Kamada and Charles River Laboratories 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.