Correlation Between Suntex Enterprises and KKR Co
Can any of the company-specific risk be diversified away by investing in both Suntex Enterprises and KKR Co 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 Suntex Enterprises and KKR Co into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Suntex Enterprises and KKR Co LP, you can compare the effects of market volatilities on Suntex Enterprises and KKR Co 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 Suntex Enterprises with a short position of KKR Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of Suntex Enterprises and KKR Co.
Diversification Opportunities for Suntex Enterprises and KKR Co
-0.63 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Suntex and KKR is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding Suntex Enterprises and KKR Co LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KKR Co LP and Suntex Enterprises 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 Suntex Enterprises are associated (or correlated) with KKR Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KKR Co LP has no effect on the direction of Suntex Enterprises i.e., Suntex Enterprises and KKR Co go up and down completely randomly.
Pair Corralation between Suntex Enterprises and KKR Co
Given the investment horizon of 90 days Suntex Enterprises is expected to generate 10.82 times more return on investment than KKR Co. However, Suntex Enterprises is 10.82 times more volatile than KKR Co LP. It trades about 0.08 of its potential returns per unit of risk. KKR Co LP is currently generating about 0.11 per unit of risk. If you would invest 0.52 in Suntex Enterprises on October 13, 2024 and sell it today you would lose (0.36) from holding Suntex Enterprises or give up 69.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Suntex Enterprises vs. KKR Co LP
Performance |
| Timeline |
| Suntex Enterprises |
| KKR Co LP |
Suntex Enterprises and KKR Co Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Suntex Enterprises and KKR Co
The main advantage of trading using opposite Suntex Enterprises and KKR Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Suntex Enterprises position performs unexpectedly, KKR Co 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 KKR Co will offset losses from the drop in KKR Co's long position.| Suntex Enterprises vs. Strategic Management and | Suntex Enterprises vs. White Label Liquid | Suntex Enterprises vs. EGF Theramed Health |
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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 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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