Correlation Between Kenon Holdings and Blue Owl

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

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

Diversification Opportunities for Kenon Holdings and Blue Owl

0.1

Correlation Coefficient

Kenon Holdings  Blue Owl

Average diversification

The 3 months correlation between Kenon and Blue is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Kenon Holdings and Blue Owl Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Owl Capital and Kenon Holdings 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 Kenon Holdings are associated (or correlated) with Blue Owl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Owl Capital has no effect on the direction of Kenon Holdings i.e., Kenon Holdings and Blue Owl go up and down completely randomly.

Pair Corralation between Kenon Holdings and Blue Owl

Considering the 90-day investment horizon Kenon Holdings is expected to generate 1.92 times more return on investment than Blue Owl. However, Kenon Holdings is 1.92 times more volatile than Blue Owl Capital. It trades about 0.14 of its potential returns per unit of risk. Blue Owl Capital is currently generating about 0.03 per unit of risk. If you would invest  2,980  in Kenon Holdings on December 17, 2024 and sell it today you would earn a total of  545.00  from holding Kenon Holdings or generate 18.29% return on investment over 90 days.

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

Kenon Holdings  vs.  Blue Owl Capital

Kenon Holdings

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kenon Holdings are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain technical and fundamental indicators, Kenon Holdings displayed solid returns over the last few months and may actually be approaching a breakup point.

Blue Owl Capital

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Blue Owl Capital are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound fundamental indicators, Blue Owl is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Kenon Holdings and Blue Owl

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

The idea behind Kenon Holdings and Blue Owl Capital 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.