Correlation Between Kilroy Realty and Mongolia Growth

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

By analyzing existing cross correlation between Kilroy Realty Corp and Mongolia Growth Group, you can compare the effects of market volatilities on Kilroy Realty and Mongolia Growth 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 Kilroy Realty with a short position of Mongolia Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kilroy Realty and Mongolia Growth.

Diversification Opportunities for Kilroy Realty and Mongolia Growth

-0.07

Correlation Coefficient

Kilroy Realty  Mongolia Growth

Good diversification

The 3 months correlation between Kilroy and Mongolia is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Kilroy Realty Corp and Mongolia Growth Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mongolia Growth Group and Kilroy Realty 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 Kilroy Realty Corp are associated (or correlated) with Mongolia Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mongolia Growth Group has no effect on the direction of Kilroy Realty i.e., Kilroy Realty and Mongolia Growth go up and down completely randomly.

Pair Corralation between Kilroy Realty and Mongolia Growth

Considering the 90-day investment horizon Kilroy Realty Corp is expected to generate 0.89 times more return on investment than Mongolia Growth. However, Kilroy Realty Corp is 1.12 times less risky than Mongolia Growth. It trades about 0.02 of its potential returns per unit of risk. Mongolia Growth Group is currently generating about 0.0 per unit of risk. If you would invest  3,439  in Kilroy Realty Corp on October 11, 2024 and sell it today you would earn a total of  268.00  from holding Kilroy Realty Corp or generate 7.79% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	99.8%
Values	Daily Returns

Kilroy Realty Corp  vs.  Mongolia Growth Group

Kilroy Realty Corp

Risk-Adjusted Performance

0 of 100

Very Weak

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

Mongolia Growth Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mongolia Growth Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's technical and fundamental indicators remain nearly stable which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with Kilroy Realty and Mongolia Growth

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

The idea behind Kilroy Realty Corp and Mongolia Growth Group 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.