Correlation Between ClimateRock and FS KKR
Can any of the company-specific risk be diversified away by investing in both ClimateRock and FS KKR 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 ClimateRock and FS KKR into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ClimateRock Class A and FS KKR Capital, you can compare the effects of market volatilities on ClimateRock and FS KKR 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 ClimateRock with a short position of FS KKR. Check out your portfolio center. Please also check ongoing floating volatility patterns of ClimateRock and FS KKR.
Diversification Opportunities for ClimateRock and FS KKR
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ClimateRock and FSK is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding ClimateRock Class A and FS KKR Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FS KKR Capital and ClimateRock 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 ClimateRock Class A are associated (or correlated) with FS KKR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FS KKR Capital has no effect on the direction of ClimateRock i.e., ClimateRock and FS KKR go up and down completely randomly.
Pair Corralation between ClimateRock and FS KKR
Given the investment horizon of 90 days ClimateRock is expected to generate 19.68 times less return on investment than FS KKR. But when comparing it to its historical volatility, ClimateRock Class A is 10.34 times less risky than FS KKR. It trades about 0.26 of its potential returns per unit of risk. FS KKR Capital is currently generating about 0.49 of returns per unit of risk over similar time horizon. If you would invest 2,035 in FS KKR Capital on August 30, 2024 and sell it today you would earn a total of 178.00 from holding FS KKR Capital or generate 8.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
ClimateRock Class A vs. FS KKR Capital
Performance |
| Timeline |
| ClimateRock Class |
| FS KKR Capital |
ClimateRock and FS KKR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ClimateRock and FS KKR
The main advantage of trading using opposite ClimateRock and FS KKR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ClimateRock position performs unexpectedly, FS KKR 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 FS KKR will offset losses from the drop in FS KKR's long position.| ClimateRock vs. AlphaVest Acquisition Corp | ClimateRock vs. Golden Star Acquisition | ClimateRock vs. Alpha One | ClimateRock vs. Manaris Corp |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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