Correlation Between SoFi Technologies and KKRS
Can any of the company-specific risk be diversified away by investing in both SoFi Technologies and KKRS 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 SoFi Technologies and KKRS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SoFi Technologies and KKRS, you can compare the effects of market volatilities on SoFi Technologies and KKRS 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 SoFi Technologies with a short position of KKRS. Check out your portfolio center. Please also check ongoing floating volatility patterns of SoFi Technologies and KKRS.
Diversification Opportunities for SoFi Technologies and KKRS
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between SoFi and KKRS is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding SoFi Technologies and KKRS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KKRS and SoFi Technologies 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 SoFi Technologies are associated (or correlated) with KKRS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KKRS has no effect on the direction of SoFi Technologies i.e., SoFi Technologies and KKRS go up and down completely randomly.
Pair Corralation between SoFi Technologies and KKRS
Given the investment horizon of 90 days SoFi Technologies is expected to generate 4.65 times more return on investment than KKRS. However, SoFi Technologies is 4.65 times more volatile than KKRS. It trades about 0.44 of its potential returns per unit of risk. KKRS is currently generating about -0.16 per unit of risk. If you would invest 1,119 in SoFi Technologies on August 27, 2024 and sell it today you would earn a total of 441.00 from holding SoFi Technologies or generate 39.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
SoFi Technologies vs. KKRS
Performance |
| Timeline |
| SoFi Technologies |
| KKRS |
SoFi Technologies and KKRS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SoFi Technologies and KKRS
The main advantage of trading using opposite SoFi Technologies and KKRS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SoFi Technologies position performs unexpectedly, KKRS 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 KKRS will offset losses from the drop in KKRS's long position.| SoFi Technologies vs. Upstart Holdings | SoFi Technologies vs. Affirm Holdings | SoFi Technologies vs. Lucid Group | SoFi Technologies vs. Palantir Technologies |
| KKRS vs. United States Cellular | KKRS vs. United States Cellular | KKRS vs. Southern Company Series | KKRS vs. Affiliated Managers Group, |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |