Correlation Between Kenon Holdings and SANTAN

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

By analyzing existing cross correlation between Kenon Holdings and SANTAN 3225 22 NOV 32, you can compare the effects of market volatilities on Kenon Holdings and SANTAN 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 SANTAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kenon Holdings and SANTAN.

Diversification Opportunities for Kenon Holdings and SANTAN

-0.53

Correlation Coefficient

Kenon Holdings  SANTAN

Excellent diversification

The 3 months correlation between Kenon and SANTAN is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Kenon Holdings and SANTAN 3225 22 NOV 32 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SANTAN 3225 22 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 SANTAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SANTAN 3225 22 has no effect on the direction of Kenon Holdings i.e., Kenon Holdings and SANTAN go up and down completely randomly.

Pair Corralation between Kenon Holdings and SANTAN

Considering the 90-day investment horizon Kenon Holdings is expected to generate 0.36 times more return on investment than SANTAN. However, Kenon Holdings is 2.81 times less risky than SANTAN. It trades about 0.04 of its potential returns per unit of risk. SANTAN 3225 22 NOV 32 is currently generating about -0.05 per unit of risk. If you would invest  3,100  in Kenon Holdings on October 10, 2024 and sell it today you would earn a total of  38.00  from holding Kenon Holdings or generate 1.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	60.0%
Values	Daily Returns

Kenon Holdings  vs.  SANTAN 3225 22 NOV 32

Kenon Holdings

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Kenon Holdings are ranked lower than 12 (%) 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.

SANTAN 3225 22

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SANTAN 3225 22 NOV 32 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest inconsistent performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for SANTAN 3225 22 NOV 32 investors.

Pair Trading with Kenon Holdings and SANTAN

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

The idea behind Kenon Holdings and SANTAN 3225 22 NOV 32 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.