Correlation Between Kkr Credit and Gold Road
Can any of the company-specific risk be diversified away by investing in both Kkr Credit and Gold Road 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 Gold Road 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 Gold Road Resources, you can compare the effects of market volatilities on Kkr Credit and Gold Road 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 Gold Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kkr Credit and Gold Road.
Diversification Opportunities for Kkr Credit and Gold Road
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kkr and Gold is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Kkr Credit Income and Gold Road Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gold Road 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 Gold Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gold Road Resources has no effect on the direction of Kkr Credit i.e., Kkr Credit and Gold Road go up and down completely randomly.
Pair Corralation between Kkr Credit and Gold Road
Assuming the 90 days trading horizon Kkr Credit is expected to generate 2.01 times less return on investment than Gold Road. But when comparing it to its historical volatility, Kkr Credit Income is 3.05 times less risky than Gold Road. It trades about 0.08 of its potential returns per unit of risk. Gold Road Resources is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 186.00 in Gold Road Resources on November 5, 2024 and sell it today you would earn a total of 62.00 from holding Gold Road Resources or generate 33.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kkr Credit Income vs. Gold Road Resources
Performance |
| Timeline |
| Kkr Credit Income |
| Gold Road Resources |
Kkr Credit and Gold Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kkr Credit and Gold Road
The main advantage of trading using opposite Kkr Credit and Gold Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kkr Credit position performs unexpectedly, Gold Road 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 Gold Road will offset losses from the drop in Gold Road's long position.| Kkr Credit vs. TPG Telecom | Kkr Credit vs. Sports Entertainment Group | Kkr Credit vs. Aristocrat Leisure | Kkr Credit vs. Autosports Group |
| Gold Road vs. Queste Communications | Gold Road vs. Kkr Credit Income | Gold Road vs. Maggie Beer Holdings | Gold Road vs. Insurance Australia 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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