Correlation Between FiscalNote Holdings and KINDER

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Can any of the company-specific risk be diversified away by investing in both FiscalNote Holdings and KINDER 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 FiscalNote Holdings and KINDER into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FiscalNote Holdings and KINDER MORGAN INC, you can compare the effects of market volatilities on FiscalNote Holdings and KINDER 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 FiscalNote Holdings with a short position of KINDER. Check out your portfolio center. Please also check ongoing floating volatility patterns of FiscalNote Holdings and KINDER.

Diversification Opportunities for FiscalNote Holdings and KINDER

0.63
  Correlation Coefficient

Poor diversification

The 3 months correlation between FiscalNote and KINDER is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding FiscalNote Holdings and KINDER MORGAN INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KINDER MORGAN INC and FiscalNote 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 FiscalNote Holdings are associated (or correlated) with KINDER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KINDER MORGAN INC has no effect on the direction of FiscalNote Holdings i.e., FiscalNote Holdings and KINDER go up and down completely randomly.

Pair Corralation between FiscalNote Holdings and KINDER

Given the investment horizon of 90 days FiscalNote Holdings is expected to under-perform the KINDER. But the stock apears to be less risky and, when comparing its historical volatility, FiscalNote Holdings is 6.14 times less risky than KINDER. The stock trades about -0.02 of its potential returns per unit of risk. The KINDER MORGAN INC is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  9,721  in KINDER MORGAN INC on September 3, 2024 and sell it today you would lose (181.00) from holding KINDER MORGAN INC or give up 1.86% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy97.58%
ValuesDaily Returns

FiscalNote Holdings  vs.  KINDER MORGAN INC

 Performance 
       Timeline  
FiscalNote Holdings 

Risk-Adjusted Performance

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Over the last 90 days FiscalNote Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unsteady performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.
KINDER MORGAN INC 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days KINDER MORGAN INC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, KINDER is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

FiscalNote Holdings and KINDER Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with FiscalNote Holdings and KINDER

The main advantage of trading using opposite FiscalNote Holdings and KINDER positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FiscalNote Holdings position performs unexpectedly, KINDER 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 KINDER will offset losses from the drop in KINDER's long position.
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The idea behind FiscalNote Holdings and KINDER MORGAN INC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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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