Correlation Between Kinetik Holdings and DAIMLERCHRYSLER

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

By analyzing existing cross correlation between Kinetik Holdings and DAIMLERCHRYSLER NORTH AMER, you can compare the effects of market volatilities on Kinetik Holdings and DAIMLERCHRYSLER 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 DAIMLERCHRYSLER. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetik Holdings and DAIMLERCHRYSLER.

Diversification Opportunities for Kinetik Holdings and DAIMLERCHRYSLER

-0.37

Correlation Coefficient

Kinetik Holdings  DAIMLERCHRYSLER

Very good diversification

The 3 months correlation between Kinetik and DAIMLERCHRYSLER is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Kinetik Holdings and DAIMLERCHRYSLER NORTH AMER in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DAIMLERCHRYSLER NORTH 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 DAIMLERCHRYSLER. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DAIMLERCHRYSLER NORTH has no effect on the direction of Kinetik Holdings i.e., Kinetik Holdings and DAIMLERCHRYSLER go up and down completely randomly.

Pair Corralation between Kinetik Holdings and DAIMLERCHRYSLER

Given the investment horizon of 90 days Kinetik Holdings is expected to under-perform the DAIMLERCHRYSLER. In addition to that, Kinetik Holdings is 5.43 times more volatile than DAIMLERCHRYSLER NORTH AMER. It trades about -0.05 of its total potential returns per unit of risk. DAIMLERCHRYSLER NORTH AMER is currently generating about 0.1 per unit of volatility. If you would invest  11,711  in DAIMLERCHRYSLER NORTH AMER on December 28, 2024 and sell it today you would earn a total of  288.00  from holding DAIMLERCHRYSLER NORTH AMER or generate 2.46% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.77%
Values	Daily Returns

Kinetik Holdings  vs.  DAIMLERCHRYSLER NORTH AMER

Kinetik Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kinetik Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

DAIMLERCHRYSLER NORTH

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in DAIMLERCHRYSLER NORTH AMER are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, DAIMLERCHRYSLER is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Kinetik Holdings and DAIMLERCHRYSLER

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

The idea behind Kinetik Holdings and DAIMLERCHRYSLER NORTH AMER 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.