Correlation Between Kinetik Holdings and Tsakos Energy
Can any of the company-specific risk be diversified away by investing in both Kinetik Holdings and Tsakos Energy 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 Kinetik Holdings and Tsakos Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinetik Holdings and Tsakos Energy Navigation, you can compare the effects of market volatilities on Kinetik Holdings and Tsakos Energy 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 Kinetik Holdings with a short position of Tsakos Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetik Holdings and Tsakos Energy.
Diversification Opportunities for Kinetik Holdings and Tsakos Energy
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kinetik and Tsakos is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding Kinetik Holdings and Tsakos Energy Navigation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tsakos Energy Navigation and Kinetik Holdings 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 Kinetik Holdings are associated (or correlated) with Tsakos Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tsakos Energy Navigation has no effect on the direction of Kinetik Holdings i.e., Kinetik Holdings and Tsakos Energy go up and down completely randomly.
Pair Corralation between Kinetik Holdings and Tsakos Energy
Given the investment horizon of 90 days Kinetik Holdings is expected to generate 0.88 times more return on investment than Tsakos Energy. However, Kinetik Holdings is 1.13 times less risky than Tsakos Energy. It trades about 0.2 of its potential returns per unit of risk. Tsakos Energy Navigation is currently generating about -0.03 per unit of risk. If you would invest 3,349 in Kinetik Holdings on August 27, 2024 and sell it today you would earn a total of 2,816 from holding Kinetik Holdings or generate 84.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetik Holdings vs. Tsakos Energy Navigation
Performance |
| Timeline |
| Kinetik Holdings |
| Tsakos Energy Navigation |
Kinetik Holdings and Tsakos Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetik Holdings and Tsakos Energy
The main advantage of trading using opposite Kinetik Holdings and Tsakos Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetik Holdings position performs unexpectedly, Tsakos Energy 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 Tsakos Energy will offset losses from the drop in Tsakos Energy's long position.| Kinetik Holdings vs. Western Midstream Partners | Kinetik Holdings vs. DT Midstream | Kinetik Holdings vs. MPLX LP | Kinetik Holdings vs. Hess Midstream Partners |
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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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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