Correlation Between Braskem SA and Kinetik Holdings
Can any of the company-specific risk be diversified away by investing in both Braskem SA and Kinetik Holdings 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 Braskem SA and Kinetik Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Braskem SA Class and Kinetik Holdings, you can compare the effects of market volatilities on Braskem SA and Kinetik Holdings 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 Braskem SA with a short position of Kinetik Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Braskem SA and Kinetik Holdings.
Diversification Opportunities for Braskem SA and Kinetik Holdings
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Braskem and Kinetik is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding Braskem SA Class and Kinetik Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinetik Holdings and Braskem SA 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 Braskem SA Class are associated (or correlated) with Kinetik Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinetik Holdings has no effect on the direction of Braskem SA i.e., Braskem SA and Kinetik Holdings go up and down completely randomly.
Pair Corralation between Braskem SA and Kinetik Holdings
Considering the 90-day investment horizon Braskem SA Class is expected to under-perform the Kinetik Holdings. In addition to that, Braskem SA is 1.81 times more volatile than Kinetik Holdings. It trades about -0.05 of its total potential returns per unit of risk. Kinetik Holdings is currently generating about 0.12 per unit of volatility. If you would invest 3,124 in Kinetik Holdings on September 3, 2024 and sell it today you would earn a total of 2,594 from holding Kinetik Holdings or generate 83.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Braskem SA Class vs. Kinetik Holdings
Performance |
| Timeline |
| Braskem SA Class |
| Kinetik Holdings |
Braskem SA and Kinetik Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Braskem SA and Kinetik Holdings
The main advantage of trading using opposite Braskem SA and Kinetik Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Braskem SA position performs unexpectedly, Kinetik Holdings 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 Kinetik Holdings will offset losses from the drop in Kinetik Holdings' long position.| Braskem SA vs. Valhi Inc | Braskem SA vs. Huntsman | Braskem SA vs. Lsb Industries | Braskem SA vs. Westlake Chemical Partners |
| Kinetik Holdings vs. Western Midstream Partners | Kinetik Holdings vs. DT Midstream | Kinetik Holdings vs. MPLX LP | Kinetik Holdings vs. Hess Midstream Partners |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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