Correlation Between Marygold Companies and KKR Co

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

By analyzing existing cross correlation between Marygold Companies and KKR Co LP, you can compare the effects of market volatilities on Marygold Companies and KKR Co 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 Marygold Companies with a short position of KKR Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of Marygold Companies and KKR Co.

Diversification Opportunities for Marygold Companies and KKR Co

0.19

Correlation Coefficient

Marygold Companies  KKR Co

Average diversification

The 3 months correlation between Marygold and KKR is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Marygold Companies and KKR Co LP in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KKR Co LP and Marygold Companies 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 Marygold Companies are associated (or correlated) with KKR Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KKR Co LP has no effect on the direction of Marygold Companies i.e., Marygold Companies and KKR Co go up and down completely randomly.

Pair Corralation between Marygold Companies and KKR Co

Given the investment horizon of 90 days Marygold Companies is expected to generate 5.0 times more return on investment than KKR Co. However, Marygold Companies is 5.0 times more volatile than KKR Co LP. It trades about 0.12 of its potential returns per unit of risk. KKR Co LP is currently generating about 0.08 per unit of risk. If you would invest  124.00  in Marygold Companies on October 11, 2024 and sell it today you would earn a total of  71.00  from holding Marygold Companies or generate 57.26% return on investment over 90 days.

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

Marygold Companies  vs.  KKR Co LP

Marygold Companies

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Marygold Companies are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak essential indicators, Marygold Companies exhibited solid returns over the last few months and may actually be approaching a breakup point.

KKR Co LP

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in KKR Co LP are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Even with relatively fragile forward-looking signals, KKR Co may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Marygold Companies and KKR Co

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

The idea behind Marygold Companies and KKR Co LP 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.