Correlation Between Kayne Anderson and Kayne Anderson

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Can any of the company-specific risk be diversified away by investing in both Kayne Anderson and Kayne Anderson 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 Kayne Anderson and Kayne Anderson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kayne Anderson Midstreamenergy and Kayne Anderson MLP, you can compare the effects of market volatilities on Kayne Anderson and Kayne Anderson 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 Kayne Anderson with a short position of Kayne Anderson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kayne Anderson and Kayne Anderson.

Diversification Opportunities for Kayne Anderson and Kayne Anderson

0.41
  Correlation Coefficient

Very weak diversification

The 3 months correlation between Kayne and Kayne is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Kayne Anderson Midstreamenergy and Kayne Anderson MLP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kayne Anderson MLP and Kayne Anderson 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 Kayne Anderson Midstreamenergy are associated (or correlated) with Kayne Anderson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kayne Anderson MLP has no effect on the direction of Kayne Anderson i.e., Kayne Anderson and Kayne Anderson go up and down completely randomly.

Pair Corralation between Kayne Anderson and Kayne Anderson

Considering the 90-day investment horizon Kayne Anderson is expected to generate 2.23 times less return on investment than Kayne Anderson. In addition to that, Kayne Anderson is 1.31 times more volatile than Kayne Anderson MLP. It trades about 0.04 of its total potential returns per unit of risk. Kayne Anderson MLP is currently generating about 0.11 per unit of volatility. If you would invest  700.00  in Kayne Anderson MLP on September 6, 2024 and sell it today you would earn a total of  601.00  from holding Kayne Anderson MLP or generate 85.86% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy30.3%
ValuesDaily Returns

Kayne Anderson Midstreamenergy  vs.  Kayne Anderson MLP

 Performance 
       Timeline  
Kayne Anderson Midst 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Kayne Anderson Midstreamenergy has generated negative risk-adjusted returns adding no value to fund investors. Despite nearly stable primary indicators, Kayne Anderson is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.
Kayne Anderson MLP 

Risk-Adjusted Performance

23 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Kayne Anderson MLP are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile basic indicators, Kayne Anderson displayed solid returns over the last few months and may actually be approaching a breakup point.

Kayne Anderson and Kayne Anderson Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Kayne Anderson and Kayne Anderson

The main advantage of trading using opposite Kayne Anderson and Kayne Anderson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kayne Anderson position performs unexpectedly, Kayne Anderson 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 Kayne Anderson will offset losses from the drop in Kayne Anderson's long position.
The idea behind Kayne Anderson Midstreamenergy and Kayne Anderson MLP 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..

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