Correlation Between FS KKR and Cion Investment

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

By analyzing existing cross correlation between FS KKR Capital and Cion Investment Corp, you can compare the effects of market volatilities on FS KKR and Cion Investment 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 FS KKR with a short position of Cion Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of FS KKR and Cion Investment.

Diversification Opportunities for FS KKR and Cion Investment

0.65

Correlation Coefficient

FS KKR  Cion Investment

Poor diversification

The 3 months correlation between FSK and Cion is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding FS KKR Capital and Cion Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cion Investment Corp and FS KKR 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 FS KKR Capital are associated (or correlated) with Cion Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cion Investment Corp has no effect on the direction of FS KKR i.e., FS KKR and Cion Investment go up and down completely randomly.

Pair Corralation between FS KKR and Cion Investment

Considering the 90-day investment horizon FS KKR Capital is expected to generate 0.95 times more return on investment than Cion Investment. However, FS KKR Capital is 1.05 times less risky than Cion Investment. It trades about 0.2 of its potential returns per unit of risk. Cion Investment Corp is currently generating about 0.08 per unit of risk. If you would invest  1,894  in FS KKR Capital on May 1, 2025 and sell it today you would earn a total of  269.00  from holding FS KKR Capital or generate 14.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.39%
Values	Daily Returns

FS KKR Capital  vs.  Cion Investment Corp

FS KKR Capital

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in FS KKR Capital are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Despite quite unsteady basic indicators, FS KKR disclosed solid returns over the last few months and may actually be approaching a breakup point.

Cion Investment Corp

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Cion Investment Corp are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Cion Investment is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with FS KKR and Cion Investment

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

The idea behind FS KKR Capital and Cion Investment Corp 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.

Check out your portfolio center.

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.