Correlation Between KKR Co and Carlyle Secured
Can any of the company-specific risk be diversified away by investing in both KKR Co and Carlyle Secured 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 Carlyle Secured 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 Carlyle Secured Lending, you can compare the effects of market volatilities on KKR Co and Carlyle Secured 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 Carlyle Secured. Check out your portfolio center. Please also check ongoing floating volatility patterns of KKR Co and Carlyle Secured.
Diversification Opportunities for KKR Co and Carlyle Secured
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between KKR and Carlyle is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding KKR Co LP and Carlyle Secured Lending in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carlyle Secured Lending 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 Carlyle Secured. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carlyle Secured Lending has no effect on the direction of KKR Co i.e., KKR Co and Carlyle Secured go up and down completely randomly.
Pair Corralation between KKR Co and Carlyle Secured
Considering the 90-day investment horizon KKR Co LP is expected to generate 2.46 times more return on investment than Carlyle Secured. However, KKR Co is 2.46 times more volatile than Carlyle Secured Lending. It trades about 0.15 of its potential returns per unit of risk. Carlyle Secured Lending is currently generating about 0.23 per unit of risk. If you would invest 13,741 in KKR Co LP on November 1, 2024 and sell it today you would earn a total of 2,948 from holding KKR Co LP or generate 21.45% 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. Carlyle Secured Lending
Performance |
| Timeline |
| KKR Co LP |
| Carlyle Secured Lending |
KKR Co and Carlyle Secured Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KKR Co and Carlyle Secured
The main advantage of trading using opposite KKR Co and Carlyle Secured positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KKR Co position performs unexpectedly, Carlyle Secured 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 Carlyle Secured will offset losses from the drop in Carlyle Secured'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 |
| Carlyle Secured vs. Sixth Street Specialty | Carlyle Secured vs. Golub Capital BDC | Carlyle Secured vs. Fidus Investment Corp | Carlyle Secured vs. New Mountain Finance |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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