Correlation Between Kkr Credit and EQ Resources
Can any of the company-specific risk be diversified away by investing in both Kkr Credit and EQ Resources 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 Kkr Credit and EQ Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kkr Credit Income and EQ Resources, you can compare the effects of market volatilities on Kkr Credit and EQ Resources 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 Kkr Credit with a short position of EQ Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kkr Credit and EQ Resources.
Diversification Opportunities for Kkr Credit and EQ Resources
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Kkr and EQR is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Kkr Credit Income and EQ Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EQ Resources and Kkr Credit 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 Kkr Credit Income are associated (or correlated) with EQ Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EQ Resources has no effect on the direction of Kkr Credit i.e., Kkr Credit and EQ Resources go up and down completely randomly.
Pair Corralation between Kkr Credit and EQ Resources
Assuming the 90 days trading horizon Kkr Credit Income is expected to under-perform the EQ Resources. But the stock apears to be less risky and, when comparing its historical volatility, Kkr Credit Income is 6.99 times less risky than EQ Resources. The stock trades about -0.02 of its potential returns per unit of risk. The EQ Resources is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 5.20 in EQ Resources on August 30, 2024 and sell it today you would lose (0.10) from holding EQ Resources or give up 1.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kkr Credit Income vs. EQ Resources
Performance |
| Timeline |
| Kkr Credit Income |
| EQ Resources |
Kkr Credit and EQ Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kkr Credit and EQ Resources
The main advantage of trading using opposite Kkr Credit and EQ Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kkr Credit position performs unexpectedly, EQ Resources 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 EQ Resources will offset losses from the drop in EQ Resources' long position.| Kkr Credit vs. Westpac Banking | Kkr Credit vs. ABACUS STORAGE KING | Kkr Credit vs. Odyssey Energy | Kkr Credit vs. Lendlease Group |
| EQ Resources vs. Queste Communications | EQ Resources vs. Kkr Credit Income | EQ Resources vs. Auswide Bank | EQ Resources vs. Janison Education Group |
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.
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