Correlation Between Kinder Morgan and ATHENE HOLDING

Can any of the company-specific risk be diversified away by investing in both Kinder Morgan and ATHENE HOLDING 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 Kinder Morgan and ATHENE HOLDING into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Kinder Morgan and ATHENE HOLDING PRFSERC, you can compare the effects of market volatilities on Kinder Morgan and ATHENE HOLDING 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 Kinder Morgan with a short position of ATHENE HOLDING. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinder Morgan and ATHENE HOLDING.

Diversification Opportunities for Kinder Morgan and ATHENE HOLDING

0.94

Correlation Coefficient

Kinder Morgan  ATHENE HOLDING

Almost no diversification

The 3 months correlation between Kinder and ATHENE is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Kinder Morgan and ATHENE HOLDING PRFSERC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ATHENE HOLDING PRFSERC and Kinder Morgan 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 Kinder Morgan are associated (or correlated) with ATHENE HOLDING. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ATHENE HOLDING PRFSERC has no effect on the direction of Kinder Morgan i.e., Kinder Morgan and ATHENE HOLDING go up and down completely randomly.

Pair Corralation between Kinder Morgan and ATHENE HOLDING

Assuming the 90 days horizon Kinder Morgan is expected to generate 2.81 times more return on investment than ATHENE HOLDING. However, Kinder Morgan is 2.81 times more volatile than ATHENE HOLDING PRFSERC. It trades about 0.14 of its potential returns per unit of risk. ATHENE HOLDING PRFSERC is currently generating about 0.16 per unit of risk. If you would invest  2,260  in Kinder Morgan on September 23, 2024 and sell it today you would earn a total of  281.00  from holding Kinder Morgan or generate 12.43% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	100.0%
Values	Daily Returns

Kinder Morgan  vs.  ATHENE HOLDING PRFSERC

Kinder Morgan

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Kinder Morgan are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Kinder Morgan reported solid returns over the last few months and may actually be approaching a breakup point.

ATHENE HOLDING PRFSERC

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in ATHENE HOLDING PRFSERC are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, ATHENE HOLDING may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Pair Trading with Kinder Morgan and ATHENE HOLDING

The main advantage of trading using opposite Kinder Morgan and ATHENE HOLDING positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinder Morgan position performs unexpectedly, ATHENE HOLDING 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 ATHENE HOLDING will offset losses from the drop in ATHENE HOLDING's long position.

The idea behind Kinder Morgan and ATHENE HOLDING PRFSERC 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.

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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.