Correlation Between Morgan Stanley and KCAP Financial
Can any of the company-specific risk be diversified away by investing in both Morgan Stanley and KCAP Financial 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 Morgan Stanley and KCAP Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Morgan Stanley Direct and KCAP Financial SR, you can compare the effects of market volatilities on Morgan Stanley and KCAP Financial 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 Morgan Stanley with a short position of KCAP Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Morgan Stanley and KCAP Financial.
Diversification Opportunities for Morgan Stanley and KCAP Financial
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Morgan and KCAP is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Morgan Stanley Direct and KCAP Financial SR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KCAP Financial SR and Morgan Stanley 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 Morgan Stanley Direct are associated (or correlated) with KCAP Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KCAP Financial SR has no effect on the direction of Morgan Stanley i.e., Morgan Stanley and KCAP Financial go up and down completely randomly.
Pair Corralation between Morgan Stanley and KCAP Financial
If you would invest 1,996 in Morgan Stanley Direct on September 13, 2024 and sell it today you would earn a total of 143.00 from holding Morgan Stanley Direct or generate 7.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Morgan Stanley Direct vs. KCAP Financial SR
Performance |
| Timeline |
| Morgan Stanley Direct |
| KCAP Financial SR |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Morgan Stanley and KCAP Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Morgan Stanley and KCAP Financial
The main advantage of trading using opposite Morgan Stanley and KCAP Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Morgan Stanley position performs unexpectedly, KCAP Financial 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 KCAP Financial will offset losses from the drop in KCAP Financial's long position.| Morgan Stanley vs. Tesla Inc | Morgan Stanley vs. Genfit | Morgan Stanley vs. Pinterest | Morgan Stanley vs. Tarsus Pharmaceuticals |
| KCAP Financial vs. Mativ Holdings | KCAP Financial vs. Keurig Dr Pepper | KCAP Financial vs. Hudson Technologies | KCAP Financial vs. Air Products and |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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