Correlation Between KKR Co and 1812 Brewing
Can any of the company-specific risk be diversified away by investing in both KKR Co and 1812 Brewing 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 1812 Brewing 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 1812 Brewing, you can compare the effects of market volatilities on KKR Co and 1812 Brewing 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 1812 Brewing. Check out your portfolio center. Please also check ongoing floating volatility patterns of KKR Co and 1812 Brewing.
Diversification Opportunities for KKR Co and 1812 Brewing
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between KKR and 1812 is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding KKR Co LP and 1812 Brewing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 1812 Brewing 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 1812 Brewing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 1812 Brewing has no effect on the direction of KKR Co i.e., KKR Co and 1812 Brewing go up and down completely randomly.
Pair Corralation between KKR Co and 1812 Brewing
Considering the 90-day investment horizon KKR Co is expected to generate 279.67 times less return on investment than 1812 Brewing. But when comparing it to its historical volatility, KKR Co LP is 127.73 times less risky than 1812 Brewing. It trades about 0.11 of its potential returns per unit of risk. 1812 Brewing is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 0.07 in 1812 Brewing on October 13, 2024 and sell it today you would lose (0.07) from holding 1812 Brewing or give up 100.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
KKR Co LP vs. 1812 Brewing
Performance |
| Timeline |
| KKR Co LP |
| 1812 Brewing |
KKR Co and 1812 Brewing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KKR Co and 1812 Brewing
The main advantage of trading using opposite KKR Co and 1812 Brewing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KKR Co position performs unexpectedly, 1812 Brewing 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 1812 Brewing will offset losses from the drop in 1812 Brewing'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 |
| 1812 Brewing vs. Indo Global Exchange | 1812 Brewing vs. Resort Savers | 1812 Brewing vs. Genesis Electronics Group | 1812 Brewing vs. TonnerOne World 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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