Correlation Between KNOT Offshore and 21036PBL1

Can any of the company-specific risk be diversified away by investing in both KNOT Offshore and 21036PBL1 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 KNOT Offshore and 21036PBL1 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between KNOT Offshore Partners and STZ 475 09 MAY 32, you can compare the effects of market volatilities on KNOT Offshore and 21036PBL1 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 KNOT Offshore with a short position of 21036PBL1. Check out your portfolio center. Please also check ongoing floating volatility patterns of KNOT Offshore and 21036PBL1.

Diversification Opportunities for KNOT Offshore and 21036PBL1

0.0

Correlation Coefficient

KNOT Offshore  21036PBL1

Pay attention - limited upside

The 3 months correlation between KNOT and 21036PBL1 is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding KNOT Offshore Partners and STZ 475 09 MAY 32 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on STZ 475 09 and KNOT Offshore 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 KNOT Offshore Partners are associated (or correlated) with 21036PBL1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of STZ 475 09 has no effect on the direction of KNOT Offshore i.e., KNOT Offshore and 21036PBL1 go up and down completely randomly.

Pair Corralation between KNOT Offshore and 21036PBL1

If you would invest  543.00  in KNOT Offshore Partners on October 25, 2024 and sell it today you would earn a total of  39.00  from holding KNOT Offshore Partners or generate 7.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

KNOT Offshore Partners  vs.  STZ 475 09 MAY 32

KNOT Offshore Partners

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KNOT Offshore Partners has generated negative risk-adjusted returns adding no value to investors with long positions. Even with latest unsteady performance, the Stock's basic indicators remain invariable and the latest agitation on Wall Street may also be a sign of long-running gains for the enterprise retail investors.

STZ 475 09

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days STZ 475 09 MAY 32 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, 21036PBL1 is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with KNOT Offshore and 21036PBL1

The main advantage of trading using opposite KNOT Offshore and 21036PBL1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KNOT Offshore position performs unexpectedly, 21036PBL1 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 21036PBL1 will offset losses from the drop in 21036PBL1's long position.

The idea behind KNOT Offshore Partners and STZ 475 09 MAY 32 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.

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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.