Correlation Between Kennedy Wilson and Vy(r) Clarion

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

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

Diversification Opportunities for Kennedy Wilson and Vy(r) Clarion

0.78

Correlation Coefficient

Kennedy Wilson  Vy(r) Clarion

Poor diversification

The 3 months correlation between Kennedy and Vy(r) is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Kennedy Wilson Holdings and Vy Clarion Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vy Clarion Real and Kennedy Wilson 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 Kennedy Wilson Holdings are associated (or correlated) with Vy(r) Clarion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vy Clarion Real has no effect on the direction of Kennedy Wilson i.e., Kennedy Wilson and Vy(r) Clarion go up and down completely randomly.

Pair Corralation between Kennedy Wilson and Vy(r) Clarion

Allowing for the 90-day total investment horizon Kennedy Wilson Holdings is expected to under-perform the Vy(r) Clarion. In addition to that, Kennedy Wilson is 1.95 times more volatile than Vy Clarion Real. It trades about -0.04 of its total potential returns per unit of risk. Vy Clarion Real is currently generating about 0.02 per unit of volatility. If you would invest  2,695  in Vy Clarion Real on October 22, 2024 and sell it today you would earn a total of  127.00  from holding Vy Clarion Real or generate 4.71% return on investment over 90 days.

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

Kennedy Wilson Holdings  vs.  Vy Clarion Real

Kennedy Wilson Holdings

Risk-Adjusted Performance

0 of 100

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 February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Vy Clarion Real

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Vy Clarion Real has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Vy(r) Clarion is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Kennedy Wilson and Vy(r) Clarion

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

The idea behind Kennedy Wilson Holdings and Vy Clarion Real 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.