Correlation Between KKR Acquisition and Jaws Mustang

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

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

Diversification Opportunities for KKR Acquisition and Jaws Mustang

0.36

Correlation Coefficient

KKR Acquisition  Jaws Mustang

Weak diversification

The 3 months correlation between KKR and Jaws is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding KKR Acquisition Holdings and Jaws Mustang Acquisition in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jaws Mustang Acquisition and KKR Acquisition 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 KKR Acquisition Holdings are associated (or correlated) with Jaws Mustang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jaws Mustang Acquisition has no effect on the direction of KKR Acquisition i.e., KKR Acquisition and Jaws Mustang go up and down completely randomly.

Pair Corralation between KKR Acquisition and Jaws Mustang

If you would invest  1,001  in KKR Acquisition Holdings on January 25, 2024 and sell it today you would earn a total of  0.00  from holding KKR Acquisition Holdings or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	4.76%
Values	Daily Returns

KKR Acquisition Holdings  vs.  Jaws Mustang Acquisition

KKR Acquisition Holdings

Risk-Adjusted Performance

0 of 100

Very Weak

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

Jaws Mustang Acquisition

Risk-Adjusted Performance

2 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Jaws Mustang Acquisition are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Jaws Mustang is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with KKR Acquisition and Jaws Mustang

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

The idea behind KKR Acquisition Holdings and Jaws Mustang 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.