Correlation Between Kinetik Holdings and 191216DC1

Can any of the company-specific risk be diversified away by investing in both Kinetik Holdings and 191216DC1 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 Kinetik Holdings and 191216DC1 into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Kinetik Holdings and COCA COLA CO, you can compare the effects of market volatilities on Kinetik Holdings and 191216DC1 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 Kinetik Holdings with a short position of 191216DC1. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetik Holdings and 191216DC1.

Diversification Opportunities for Kinetik Holdings and 191216DC1

-0.15

Correlation Coefficient

Kinetik Holdings  191216DC1

Good diversification

The 3 months correlation between Kinetik and 191216DC1 is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Kinetik Holdings and COCA COLA CO in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on COCA A CO and Kinetik Holdings 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 Kinetik Holdings are associated (or correlated) with 191216DC1. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of COCA A CO has no effect on the direction of Kinetik Holdings i.e., Kinetik Holdings and 191216DC1 go up and down completely randomly.

Pair Corralation between Kinetik Holdings and 191216DC1

Given the investment horizon of 90 days Kinetik Holdings is expected to generate 2.08 times less return on investment than 191216DC1. But when comparing it to its historical volatility, Kinetik Holdings is 2.29 times less risky than 191216DC1. It trades about 0.14 of its potential returns per unit of risk. COCA COLA CO is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest  6,255  in COCA COLA CO on October 10, 2024 and sell it today you would earn a total of  639.00  from holding COCA COLA CO or generate 10.22% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	95.24%
Values	Daily Returns

Kinetik Holdings  vs.  COCA COLA CO

Kinetik Holdings

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Kinetik Holdings are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite quite weak basic indicators, Kinetik Holdings disclosed solid returns over the last few months and may actually be approaching a breakup point.

COCA A CO

Risk-Adjusted Performance

4 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in COCA COLA CO are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unsteady basic indicators, 191216DC1 may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Kinetik Holdings and 191216DC1

The main advantage of trading using opposite Kinetik Holdings and 191216DC1 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetik Holdings position performs unexpectedly, 191216DC1 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 191216DC1 will offset losses from the drop in 191216DC1's long position.

The idea behind Kinetik Holdings and COCA COLA CO 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.