Correlation Between Cherry Hill and KKR Real
Can any of the company-specific risk be diversified away by investing in both Cherry Hill and KKR Real 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 Cherry Hill and KKR Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cherry Hill Mortgage and KKR Real Estate, you can compare the effects of market volatilities on Cherry Hill and KKR Real 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 Cherry Hill with a short position of KKR Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cherry Hill and KKR Real.
Diversification Opportunities for Cherry Hill and KKR Real
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Cherry and KKR is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Cherry Hill Mortgage and KKR Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KKR Real Estate and Cherry Hill 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 Cherry Hill Mortgage are associated (or correlated) with KKR Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KKR Real Estate has no effect on the direction of Cherry Hill i.e., Cherry Hill and KKR Real go up and down completely randomly.
Pair Corralation between Cherry Hill and KKR Real
Given the investment horizon of 90 days Cherry Hill Mortgage is expected to generate 1.92 times more return on investment than KKR Real. However, Cherry Hill is 1.92 times more volatile than KKR Real Estate. It trades about 0.43 of its potential returns per unit of risk. KKR Real Estate is currently generating about -0.13 per unit of risk. If you would invest 262.00 in Cherry Hill Mortgage on November 4, 2024 and sell it today you would earn a total of 67.00 from holding Cherry Hill Mortgage or generate 25.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cherry Hill Mortgage vs. KKR Real Estate
Performance |
| Timeline |
| Cherry Hill Mortgage |
| KKR Real Estate |
Cherry Hill and KKR Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cherry Hill and KKR Real
The main advantage of trading using opposite Cherry Hill and KKR Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cherry Hill position performs unexpectedly, KKR Real 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 Real will offset losses from the drop in KKR Real's long position.| Cherry Hill vs. Ellington Financial | Cherry Hill vs. Dynex Capital | Cherry Hill vs. Ares Commercial Real | Cherry Hill vs. Chimera Investment |
| KKR Real vs. Ellington Financial | KKR Real vs. Dynex Capital | KKR Real vs. Ares Commercial Real | KKR Real vs. Cherry Hill Mortgage |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |