Correlation Between Signet International and KKR Co

Can any of the company-specific risk be diversified away by investing in both Signet International 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 Signet International and KKR Co into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Signet International Holdings and KKR Co LP, you can compare the effects of market volatilities on Signet International 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 Signet International with a short position of KKR Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of Signet International and KKR Co.

Diversification Opportunities for Signet International and KKR Co

0.0

Correlation Coefficient

Signet International  KKR Co

Pay attention - limited upside

The 3 months correlation between Signet and KKR is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Signet International Holdings 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 Signet International 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 Signet International Holdings 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 Signet International i.e., Signet International and KKR Co go up and down completely randomly.

Pair Corralation between Signet International and KKR Co

If you would invest  12,361  in KKR Co LP on August 30, 2024 and sell it today you would earn a total of  3,642  from holding KKR Co LP or generate 29.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Signet International Holdings  vs.  KKR Co LP

Signet International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Signet International Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Signet International is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

KKR Co LP

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in KKR Co LP are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. Even with relatively unsteady forward-looking signals, KKR Co reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Signet International and KKR Co

The main advantage of trading using opposite Signet International and KKR Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Signet International 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.

The idea behind Signet International Holdings and KKR Co LP 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 Commodity Directory module to find actively traded commodities issued by global exchanges.