Correlation Between VARIOUS EATERIES and KKR Co
Can any of the company-specific risk be diversified away by investing in both VARIOUS EATERIES and KKR Co 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 VARIOUS EATERIES and KKR Co into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VARIOUS EATERIES LS and KKR Co LP, you can compare the effects of market volatilities on VARIOUS EATERIES and KKR Co 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 VARIOUS EATERIES with a short position of KKR Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of VARIOUS EATERIES and KKR Co.
Diversification Opportunities for VARIOUS EATERIES and KKR Co
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between VARIOUS and KKR is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding VARIOUS EATERIES LS and KKR Co LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KKR Co LP and VARIOUS EATERIES 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 VARIOUS EATERIES LS are associated (or correlated) with KKR Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KKR Co LP has no effect on the direction of VARIOUS EATERIES i.e., VARIOUS EATERIES and KKR Co go up and down completely randomly.
Pair Corralation between VARIOUS EATERIES and KKR Co
Assuming the 90 days horizon VARIOUS EATERIES LS is expected to under-perform the KKR Co. In addition to that, VARIOUS EATERIES is 1.2 times more volatile than KKR Co LP. It trades about -0.03 of its total potential returns per unit of risk. KKR Co LP is currently generating about 0.13 per unit of volatility. If you would invest 4,475 in KKR Co LP on September 3, 2024 and sell it today you would earn a total of 10,823 from holding KKR Co LP or generate 241.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
VARIOUS EATERIES LS vs. KKR Co LP
Performance |
| Timeline |
| VARIOUS EATERIES |
| KKR Co LP |
VARIOUS EATERIES and KKR Co Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VARIOUS EATERIES and KKR Co
The main advantage of trading using opposite VARIOUS EATERIES and KKR Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VARIOUS EATERIES position performs unexpectedly, KKR Co 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 KKR Co will offset losses from the drop in KKR Co's long position.| VARIOUS EATERIES vs. McDonalds | VARIOUS EATERIES vs. Chipotle Mexican Grill | VARIOUS EATERIES vs. Superior Plus Corp | VARIOUS EATERIES vs. NMI Holdings |
| KKR Co vs. MCEWEN MINING INC | KKR Co vs. Natural Health Trends | KKR Co vs. ULTRA CLEAN HLDGS | KKR Co vs. GRIFFIN MINING LTD |
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 the Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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