Correlation Between Kkr Credit and Westpac Banking
Can any of the company-specific risk be diversified away by investing in both Kkr Credit and Westpac Banking 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 Westpac Banking 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 Westpac Banking, you can compare the effects of market volatilities on Kkr Credit and Westpac Banking 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 Westpac Banking. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kkr Credit and Westpac Banking.
Diversification Opportunities for Kkr Credit and Westpac Banking
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kkr and Westpac is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Kkr Credit Income and Westpac Banking in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westpac Banking 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 Westpac Banking. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westpac Banking has no effect on the direction of Kkr Credit i.e., Kkr Credit and Westpac Banking go up and down completely randomly.
Pair Corralation between Kkr Credit and Westpac Banking
Assuming the 90 days trading horizon Kkr Credit Income is expected to under-perform the Westpac Banking. In addition to that, Kkr Credit is 2.73 times more volatile than Westpac Banking. It trades about -0.03 of its total potential returns per unit of risk. Westpac Banking is currently generating about 0.11 per unit of volatility. If you would invest 10,528 in Westpac Banking on November 3, 2024 and sell it today you would earn a total of 57.00 from holding Westpac Banking or generate 0.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Kkr Credit Income vs. Westpac Banking
Performance |
| Timeline |
| Kkr Credit Income |
| Westpac Banking |
Kkr Credit and Westpac Banking Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kkr Credit and Westpac Banking
The main advantage of trading using opposite Kkr Credit and Westpac Banking positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kkr Credit position performs unexpectedly, Westpac Banking 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 Westpac Banking will offset losses from the drop in Westpac Banking's long position.| Kkr Credit vs. Centuria Industrial Reit | Kkr Credit vs. Stelar Metals | Kkr Credit vs. Perseus Mining | Kkr Credit vs. FireFly Metals |
| Westpac Banking vs. Sayona Mining | Westpac Banking vs. Macquarie Technology Group | Westpac Banking vs. Ambertech | Westpac Banking vs. Readytech Holdings |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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