Correlation Between Kernel Group and Everest Consolidator

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

By analyzing existing cross correlation between Kernel Group Holdings and Everest Consolidator Acquisition, you can compare the effects of market volatilities on Kernel Group and Everest Consolidator 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 Kernel Group with a short position of Everest Consolidator. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kernel Group and Everest Consolidator.

Diversification Opportunities for Kernel Group and Everest Consolidator

0.0

Correlation Coefficient

Kernel Group  Everest Consolidator

Pay attention - limited upside

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

Pair Corralation between Kernel Group and Everest Consolidator

If you would invest (100.00) in Everest Consolidator Acquisition on December 20, 2024 and sell it today you would earn a total of  100.00  from holding Everest Consolidator Acquisition or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Kernel Group Holdings  vs.  Everest Consolidator Acquisiti

Kernel Group Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kernel Group Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, Kernel Group is not utilizing all of its potentials. The latest stock price mess, may contribute to short-term losses for the institutional investors.

Everest Consolidator

Risk-Adjusted Performance

Very Weak

Over the last 90 days Everest Consolidator Acquisition has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Everest Consolidator is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Kernel Group and Everest Consolidator

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

The idea behind Kernel Group Holdings and Everest Consolidator Acquisition 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.