Correlation Between FS KKR and Lees Pharmaceutical

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

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

Diversification Opportunities for FS KKR and Lees Pharmaceutical

-0.15

Correlation Coefficient

FS KKR  Lees Pharmaceutical

Good diversification

The 3 months correlation between FSK and Lees is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding FS KKR Capital and Lees Pharmaceutical Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lees Pharmaceutical and FS KKR 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 FS KKR Capital are associated (or correlated) with Lees Pharmaceutical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lees Pharmaceutical has no effect on the direction of FS KKR i.e., FS KKR and Lees Pharmaceutical go up and down completely randomly.

Pair Corralation between FS KKR and Lees Pharmaceutical

If you would invest  1,906  in FS KKR Capital on October 24, 2024 and sell it today you would earn a total of  320.00  from holding FS KKR Capital or generate 16.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.23%
Values	Daily Returns

FS KKR Capital  vs.  Lees Pharmaceutical Holdings

FS KKR Capital

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in FS KKR Capital are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite quite unsteady basic indicators, FS KKR may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Lees Pharmaceutical

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Lees Pharmaceutical Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Lees Pharmaceutical is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with FS KKR and Lees Pharmaceutical

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

The idea behind FS KKR Capital and Lees Pharmaceutical Holdings 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 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..