Correlation Between Kenon Holdings and Viking Holdings
Can any of the company-specific risk be diversified away by investing in both Kenon Holdings and Viking Holdings 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 Viking Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kenon Holdings and Viking Holdings, you can compare the effects of market volatilities on Kenon Holdings and Viking Holdings 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 Viking Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kenon Holdings and Viking Holdings.
Diversification Opportunities for Kenon Holdings and Viking Holdings
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kenon and Viking is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Kenon Holdings and Viking Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Viking Holdings 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 Viking Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Viking Holdings has no effect on the direction of Kenon Holdings i.e., Kenon Holdings and Viking Holdings go up and down completely randomly.
Pair Corralation between Kenon Holdings and Viking Holdings
Considering the 90-day investment horizon Kenon Holdings is expected to generate 1.45 times more return on investment than Viking Holdings. However, Kenon Holdings is 1.45 times more volatile than Viking Holdings. It trades about 0.23 of its potential returns per unit of risk. Viking Holdings is currently generating about 0.15 per unit of risk. If you would invest 2,975 in Kenon Holdings on October 24, 2024 and sell it today you would earn a total of 346.00 from holding Kenon Holdings or generate 11.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kenon Holdings vs. Viking Holdings
Performance |
| Timeline |
| Kenon Holdings |
| Viking Holdings |
Kenon Holdings and Viking Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kenon Holdings and Viking Holdings
The main advantage of trading using opposite Kenon Holdings and Viking Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kenon Holdings position performs unexpectedly, Viking Holdings 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 Viking Holdings will offset losses from the drop in Viking Holdings' long position.| Kenon Holdings vs. Vistra Energy Corp | Kenon Holdings vs. Pampa Energia SA | Kenon Holdings vs. NRG Energy | Kenon Holdings vs. TransAlta Corp |
| Viking Holdings vs. Columbia Sportswear | Viking Holdings vs. Skechers USA | Viking Holdings vs. ServiceNow | Viking Holdings vs. Levi Strauss Co |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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