Correlation Between MDJH Old and Kennedy Wilson

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

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

Diversification Opportunities for MDJH Old and Kennedy Wilson

0.33

Correlation Coefficient

MDJH Old  Kennedy Wilson

Weak diversification

The 3 months correlation between MDJH and Kennedy is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding MDJH Old 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 MDJH Old 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 MDJH Old 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 MDJH Old i.e., MDJH Old and Kennedy Wilson go up and down completely randomly.

Pair Corralation between MDJH Old and Kennedy Wilson

Given the investment horizon of 90 days MDJH Old is expected to generate 9.41 times more return on investment than Kennedy Wilson. However, MDJH Old is 9.41 times more volatile than Kennedy Wilson Holdings. It trades about 0.12 of its potential returns per unit of risk. Kennedy Wilson Holdings is currently generating about -0.08 per unit of risk. If you would invest  19.00  in MDJH Old on December 27, 2024 and sell it today you would earn a total of  5.00  from holding MDJH Old or generate 26.32% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	41.67%
Values	Daily Returns

MDJH Old  vs.  Kennedy Wilson Holdings

MDJH Old

Risk-Adjusted Performance

OK

Over the last 90 days MDJH Old has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly unfluctuating forward-looking indicators, MDJH Old demonstrated solid returns over the last few months and may actually be approaching a breakup point.

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 latest inconsistent performance, the Stock's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the venture sophisticated investors.

Pair Trading with MDJH Old and Kennedy Wilson

The main advantage of trading using opposite MDJH Old and Kennedy Wilson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MDJH Old 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 MDJH Old 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.

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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.