Correlation Between BlackRock TCP and KKR Co
Can any of the company-specific risk be diversified away by investing in both BlackRock TCP 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 BlackRock TCP and KKR Co into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BlackRock TCP Capital and KKR Co LP, you can compare the effects of market volatilities on BlackRock TCP 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 BlackRock TCP with a short position of KKR Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlackRock TCP and KKR Co.
Diversification Opportunities for BlackRock TCP and KKR Co
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between BlackRock and KKR is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding BlackRock TCP Capital 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 BlackRock TCP 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 BlackRock TCP Capital 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 BlackRock TCP i.e., BlackRock TCP and KKR Co go up and down completely randomly.
Pair Corralation between BlackRock TCP and KKR Co
Given the investment horizon of 90 days BlackRock TCP Capital is expected to generate 0.62 times more return on investment than KKR Co. However, BlackRock TCP Capital is 1.6 times less risky than KKR Co. It trades about 0.15 of its potential returns per unit of risk. KKR Co LP is currently generating about -0.19 per unit of risk. If you would invest 895.00 in BlackRock TCP Capital on November 18, 2024 and sell it today you would earn a total of 46.00 from holding BlackRock TCP Capital or generate 5.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BlackRock TCP Capital vs. KKR Co LP
Performance |
| Timeline |
| BlackRock TCP Capital |
| KKR Co LP |
BlackRock TCP and KKR Co Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BlackRock TCP and KKR Co
The main advantage of trading using opposite BlackRock TCP and KKR Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BlackRock TCP 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.| BlackRock TCP vs. Triplepoint Venture Growth | BlackRock TCP vs. Sixth Street Specialty | BlackRock TCP vs. Golub Capital BDC | BlackRock TCP vs. New Mountain Finance |
| KKR Co vs. Carlyle Group | KKR Co vs. Ares Management LP | KKR Co vs. Blackstone Group | KKR Co vs. Blue Owl Capital |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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