Correlation Between Summit Midstream and WK Kellogg

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Can any of the company-specific risk be diversified away by investing in both Summit Midstream and WK Kellogg 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 Summit Midstream and WK Kellogg into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Summit Midstream and WK Kellogg Co, you can compare the effects of market volatilities on Summit Midstream and WK Kellogg 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 Summit Midstream with a short position of WK Kellogg. Check out your portfolio center. Please also check ongoing floating volatility patterns of Summit Midstream and WK Kellogg.

Diversification Opportunities for Summit Midstream and WK Kellogg

SummitKLGDiversified AwaySummitKLGDiversified Away100%
0.0
  Correlation Coefficient

Pay attention - limited upside

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

Pair Corralation between Summit Midstream and WK Kellogg

Considering the 90-day investment horizon Summit Midstream is expected to generate 0.53 times more return on investment than WK Kellogg. However, Summit Midstream is 1.88 times less risky than WK Kellogg. It trades about 0.19 of its potential returns per unit of risk. WK Kellogg Co is currently generating about 0.01 per unit of risk. If you would invest  3,500  in Summit Midstream on October 27, 2024 and sell it today you would earn a total of  788.00  from holding Summit Midstream or generate 22.51% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Summit Midstream  vs.  WK Kellogg Co

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -10-505101520
JavaScript chart by amCharts 3.21.15SMC KLG
       Timeline  
Summit Midstream 

Risk-Adjusted Performance

14 of 100

 
Weak
 
Strong
Good
Compared to the overall equity markets, risk-adjusted returns on investments in Summit Midstream are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile primary indicators, Summit Midstream exhibited solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan32343638404244
WK Kellogg 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days WK Kellogg Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, WK Kellogg is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan161718192021

Summit Midstream and WK Kellogg Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-5.62-4.21-2.8-1.390.01.452.984.56.037.55 0.020.040.060.080.100.12
JavaScript chart by amCharts 3.21.15SMC KLG
       Returns  

Pair Trading with Summit Midstream and WK Kellogg

The main advantage of trading using opposite Summit Midstream and WK Kellogg positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Summit Midstream position performs unexpectedly, WK Kellogg 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 WK Kellogg will offset losses from the drop in WK Kellogg's long position.
The idea behind Summit Midstream and WK Kellogg 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.

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