Correlation Between KKR Co and Singapore Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both KKR Co and Singapore Telecommunicatio 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 Singapore Telecommunicatio 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 Singapore Telecommunications Limited, you can compare the effects of market volatilities on KKR Co and Singapore Telecommunicatio 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 Singapore Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of KKR Co and Singapore Telecommunicatio.
Diversification Opportunities for KKR Co and Singapore Telecommunicatio
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between KKR and Singapore is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding KKR Co LP and Singapore Telecommunications L in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Singapore Telecommunicatio 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 Singapore Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Singapore Telecommunicatio has no effect on the direction of KKR Co i.e., KKR Co and Singapore Telecommunicatio go up and down completely randomly.
Pair Corralation between KKR Co and Singapore Telecommunicatio
Assuming the 90 days trading horizon KKR Co LP is expected to generate 1.2 times more return on investment than Singapore Telecommunicatio. However, KKR Co is 1.2 times more volatile than Singapore Telecommunications Limited. It trades about 0.22 of its potential returns per unit of risk. Singapore Telecommunications Limited is currently generating about 0.1 per unit of risk. If you would invest 9,489 in KKR Co LP on November 3, 2024 and sell it today you would earn a total of 6,739 from holding KKR Co LP or generate 71.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KKR Co LP vs. Singapore Telecommunications L
Performance |
| Timeline |
| KKR Co LP |
| Singapore Telecommunicatio |
KKR Co and Singapore Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KKR Co and Singapore Telecommunicatio
The main advantage of trading using opposite KKR Co and Singapore Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KKR Co position performs unexpectedly, Singapore Telecommunicatio 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 Singapore Telecommunicatio will offset losses from the drop in Singapore Telecommunicatio's long position.| KKR Co vs. BROADSTNET LEADL 00025 | KKR Co vs. OFFICE DEPOT | KKR Co vs. Texas Roadhouse | KKR Co vs. TEXAS ROADHOUSE |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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