Correlation Between Kkr Credit and Hutchison Telecommunicatio
Can any of the company-specific risk be diversified away by investing in both Kkr Credit and Hutchison Telecommunicatio 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 Kkr Credit and Hutchison Telecommunicatio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kkr Credit Income and Hutchison Telecommunications, you can compare the effects of market volatilities on Kkr Credit and Hutchison Telecommunicatio 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 Kkr Credit with a short position of Hutchison Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kkr Credit and Hutchison Telecommunicatio.
Diversification Opportunities for Kkr Credit and Hutchison Telecommunicatio
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kkr and Hutchison is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Kkr Credit Income and Hutchison Telecommunications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hutchison Telecommunicatio and Kkr Credit 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 Kkr Credit Income are associated (or correlated) with Hutchison Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hutchison Telecommunicatio has no effect on the direction of Kkr Credit i.e., Kkr Credit and Hutchison Telecommunicatio go up and down completely randomly.
Pair Corralation between Kkr Credit and Hutchison Telecommunicatio
Assuming the 90 days trading horizon Kkr Credit is expected to generate 2.38 times less return on investment than Hutchison Telecommunicatio. But when comparing it to its historical volatility, Kkr Credit Income is 3.07 times less risky than Hutchison Telecommunicatio. It trades about 0.39 of its potential returns per unit of risk. Hutchison Telecommunications is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 2.50 in Hutchison Telecommunications on September 28, 2024 and sell it today you would earn a total of 0.30 from holding Hutchison Telecommunications or generate 12.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 95.45% |
Values | Daily Returns |
Kkr Credit Income vs. Hutchison Telecommunications
Performance |
Timeline |
Kkr Credit Income |
Hutchison Telecommunicatio |
Kkr Credit and Hutchison Telecommunicatio Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Kkr Credit and Hutchison Telecommunicatio
The main advantage of trading using opposite Kkr Credit and Hutchison Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kkr Credit position performs unexpectedly, Hutchison Telecommunicatio 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 Hutchison Telecommunicatio will offset losses from the drop in Hutchison Telecommunicatio's long position.Kkr Credit vs. Westpac Banking | Kkr Credit vs. ABACUS STORAGE KING | Kkr Credit vs. Odyssey Energy | Kkr Credit vs. Sandfire Resources NL |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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