Correlation Between Kilroy Realty and ServiceNow

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

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

Diversification Opportunities for Kilroy Realty and ServiceNow

-0.37

Correlation Coefficient

Kilroy Realty  ServiceNow

Very good diversification

The 3 months correlation between Kilroy and ServiceNow is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Kilroy Realty Corp and ServiceNow in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ServiceNow and Kilroy Realty 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 Kilroy Realty Corp are associated (or correlated) with ServiceNow. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ServiceNow has no effect on the direction of Kilroy Realty i.e., Kilroy Realty and ServiceNow go up and down completely randomly.

Pair Corralation between Kilroy Realty and ServiceNow

Considering the 90-day investment horizon Kilroy Realty Corp is expected to generate 1.01 times more return on investment than ServiceNow. However, Kilroy Realty is 1.01 times more volatile than ServiceNow. It trades about 0.15 of its potential returns per unit of risk. ServiceNow is currently generating about -0.06 per unit of risk. If you would invest  3,139  in Kilroy Realty Corp on May 5, 2025 and sell it today you would earn a total of  516.00  from holding Kilroy Realty Corp or generate 16.44% return on investment over 90 days.

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

Kilroy Realty Corp  vs.  ServiceNow

Kilroy Realty Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Kilroy Realty Corp are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather unsteady basic indicators, Kilroy Realty exhibited solid returns over the last few months and may actually be approaching a breakup point.

ServiceNow

Risk-Adjusted Performance

Very Weak

Over the last 90 days ServiceNow has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, ServiceNow is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Kilroy Realty and ServiceNow

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

The idea behind Kilroy Realty Corp and ServiceNow 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.