Correlation Between KKR Co and Marblegate Acquisition

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

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

Diversification Opportunities for KKR Co and Marblegate Acquisition

0.51

Correlation Coefficient

KKR Co  Marblegate Acquisition

Very weak diversification

The 3 months correlation between KKR and Marblegate is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding KKR Co LP and Marblegate Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Marblegate Acquisition and KKR Co 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 Co LP are associated (or correlated) with Marblegate Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Marblegate Acquisition has no effect on the direction of KKR Co i.e., KKR Co and Marblegate Acquisition go up and down completely randomly.

Pair Corralation between KKR Co and Marblegate Acquisition

Considering the 90-day investment horizon KKR Co LP is expected to generate 3.47 times more return on investment than Marblegate Acquisition. However, KKR Co is 3.47 times more volatile than Marblegate Acquisition Corp. It trades about 0.09 of its potential returns per unit of risk. Marblegate Acquisition Corp is currently generating about 0.0 per unit of risk. If you would invest  13,295  in KKR Co LP on October 10, 2024 and sell it today you would earn a total of  1,367  from holding KKR Co LP or generate 10.28% return on investment over 90 days.

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

KKR Co LP  vs.  Marblegate Acquisition Corp

KKR Co LP

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in KKR Co LP are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile forward-looking signals, KKR Co may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Marblegate Acquisition

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Marblegate Acquisition Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Marblegate Acquisition is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with KKR Co and Marblegate Acquisition

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

The idea behind KKR Co LP and Marblegate Acquisition Corp 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.