Correlation Between EAGLE MATERIALS and KKR Co
Can any of the company-specific risk be diversified away by investing in both EAGLE MATERIALS 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 EAGLE MATERIALS and KKR Co into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EAGLE MATERIALS and KKR Co LP, you can compare the effects of market volatilities on EAGLE MATERIALS 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 EAGLE MATERIALS with a short position of KKR Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of EAGLE MATERIALS and KKR Co.
Diversification Opportunities for EAGLE MATERIALS and KKR Co
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between EAGLE and KKR is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding EAGLE MATERIALS 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 EAGLE MATERIALS 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 EAGLE MATERIALS 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 EAGLE MATERIALS i.e., EAGLE MATERIALS and KKR Co go up and down completely randomly.
Pair Corralation between EAGLE MATERIALS and KKR Co
Assuming the 90 days trading horizon EAGLE MATERIALS is expected to under-perform the KKR Co. But the stock apears to be less risky and, when comparing its historical volatility, EAGLE MATERIALS is 1.04 times less risky than KKR Co. The stock trades about -0.01 of its potential returns per unit of risk. The KKR Co LP is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 12,483 in KKR Co LP on September 13, 2024 and sell it today you would earn a total of 1,985 from holding KKR Co LP or generate 15.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
EAGLE MATERIALS vs. KKR Co LP
Performance |
| Timeline |
| EAGLE MATERIALS |
| KKR Co LP |
EAGLE MATERIALS and KKR Co Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EAGLE MATERIALS and KKR Co
The main advantage of trading using opposite EAGLE MATERIALS and KKR Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EAGLE MATERIALS 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.| EAGLE MATERIALS vs. Apple Inc | EAGLE MATERIALS vs. Apple Inc | EAGLE MATERIALS vs. Apple Inc | EAGLE MATERIALS vs. Apple Inc |
| KKR Co vs. EVS Broadcast Equipment | KKR Co vs. Goosehead Insurance | KKR Co vs. COPLAND ROAD CAPITAL | KKR Co vs. INSURANCE AUST GRP |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Stocks Directory Find actively traded stocks across global markets |