Correlation Between Kinetik Holdings and Western Sierra
Can any of the company-specific risk be diversified away by investing in both Kinetik Holdings and Western Sierra 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 Western Sierra into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinetik Holdings and Western Sierra Mining, you can compare the effects of market volatilities on Kinetik Holdings and Western Sierra 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 Western Sierra. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetik Holdings and Western Sierra.
Diversification Opportunities for Kinetik Holdings and Western Sierra
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kinetik and Western is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Kinetik Holdings and Western Sierra Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Sierra Mining 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 Western Sierra. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Sierra Mining has no effect on the direction of Kinetik Holdings i.e., Kinetik Holdings and Western Sierra go up and down completely randomly.
Pair Corralation between Kinetik Holdings and Western Sierra
Given the investment horizon of 90 days Kinetik Holdings is expected to generate 5.03 times more return on investment than Western Sierra. However, Kinetik Holdings is 5.03 times more volatile than Western Sierra Mining. It trades about 0.49 of its potential returns per unit of risk. Western Sierra Mining is currently generating about 0.0 per unit of risk. If you would invest 4,892 in Kinetik Holdings on August 27, 2024 and sell it today you would earn a total of 1,273 from holding Kinetik Holdings or generate 26.02% 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. Western Sierra Mining
Performance |
| Timeline |
| Kinetik Holdings |
| Western Sierra Mining |
Kinetik Holdings and Western Sierra Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetik Holdings and Western Sierra
The main advantage of trading using opposite Kinetik Holdings and Western Sierra positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetik Holdings position performs unexpectedly, Western Sierra 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 Western Sierra will offset losses from the drop in Western Sierra'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 |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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