Correlation Between Ascendas India and Kennedy Wilson

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

By analyzing existing cross correlation between Ascendas India Trust and Kennedy Wilson Holdings, you can compare the effects of market volatilities on Ascendas India and Kennedy Wilson 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 Ascendas India with a short position of Kennedy Wilson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ascendas India and Kennedy Wilson.

Diversification Opportunities for Ascendas India and Kennedy Wilson

0.55

Correlation Coefficient

Ascendas India  Kennedy Wilson

Very weak diversification

The 3 months correlation between Ascendas and Kennedy is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Ascendas India Trust and Kennedy Wilson Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kennedy Wilson Holdings and Ascendas India 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 Ascendas India Trust are associated (or correlated) with Kennedy Wilson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kennedy Wilson Holdings has no effect on the direction of Ascendas India i.e., Ascendas India and Kennedy Wilson go up and down completely randomly.

Pair Corralation between Ascendas India and Kennedy Wilson

Assuming the 90 days horizon Ascendas India is expected to generate 2.72 times less return on investment than Kennedy Wilson. In addition to that, Ascendas India is 1.14 times more volatile than Kennedy Wilson Holdings. It trades about 0.07 of its total potential returns per unit of risk. Kennedy Wilson Holdings is currently generating about 0.23 per unit of volatility. If you would invest  893.00  in Kennedy Wilson Holdings on December 4, 2024 and sell it today you would earn a total of  77.00  from holding Kennedy Wilson Holdings or generate 8.62% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.24%
Values	Daily Returns

Ascendas India Trust  vs.  Kennedy Wilson Holdings

Ascendas India Trust

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ascendas India Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental indicators, Ascendas India is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Kennedy Wilson Holdings

Risk-Adjusted Performance

Very Weak

Over the last 90 days Kennedy Wilson Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of inconsistent performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Pair Trading with Ascendas India and Kennedy Wilson

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

The idea behind Ascendas India Trust and Kennedy Wilson Holdings 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.