Correlation Between KKR Co and Avient Corp
Can any of the company-specific risk be diversified away by investing in both KKR Co and Avient Corp 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 Co and Avient Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KKR Co LP and Avient Corp, you can compare the effects of market volatilities on KKR Co and Avient Corp 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 Co with a short position of Avient Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of KKR Co and Avient Corp.
Diversification Opportunities for KKR Co and Avient Corp
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between KKR and Avient is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding KKR Co LP and Avient Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Avient Corp and KKR Co 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 Co LP are associated (or correlated) with Avient Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Avient Corp has no effect on the direction of KKR Co i.e., KKR Co and Avient Corp go up and down completely randomly.
Pair Corralation between KKR Co and Avient Corp
Considering the 90-day investment horizon KKR Co LP is expected to generate 1.06 times more return on investment than Avient Corp. However, KKR Co is 1.06 times more volatile than Avient Corp. It trades about 0.11 of its potential returns per unit of risk. Avient Corp is currently generating about 0.02 per unit of risk. If you would invest 4,960 in KKR Co LP on November 27, 2024 and sell it today you would earn a total of 8,159 from holding KKR Co LP or generate 164.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KKR Co LP vs. Avient Corp
Performance |
| Timeline |
| KKR Co LP |
| Avient Corp |
KKR Co and Avient Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KKR Co and Avient Corp
The main advantage of trading using opposite KKR Co and Avient Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KKR Co position performs unexpectedly, Avient Corp 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 Avient Corp will offset losses from the drop in Avient Corp's long position.| KKR Co vs. Carlyle Group | KKR Co vs. Ares Management LP | KKR Co vs. Blackstone Group | KKR Co vs. Blue Owl Capital |
| Avient Corp vs. Axalta Coating Systems | Avient Corp vs. H B Fuller | Avient Corp vs. Quaker Chemical | Avient Corp vs. Cabot |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Transaction History View history of all your transactions and understand their impact on performance | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |