Correlation Between Redfin Corp and Kennedy Wilson
Can any of the company-specific risk be diversified away by investing in both Redfin Corp 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 Redfin Corp and Kennedy Wilson into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Redfin Corp and Kennedy Wilson Holdings, you can compare the effects of market volatilities on Redfin Corp 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 Redfin Corp with a short position of Kennedy Wilson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Redfin Corp and Kennedy Wilson.
Diversification Opportunities for Redfin Corp and Kennedy Wilson
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Redfin and Kennedy is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Redfin Corp 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 Redfin Corp 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 Redfin Corp 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 Redfin Corp i.e., Redfin Corp and Kennedy Wilson go up and down completely randomly.
Pair Corralation between Redfin Corp and Kennedy Wilson
Given the investment horizon of 90 days Redfin Corp is expected to generate 2.91 times more return on investment than Kennedy Wilson. However, Redfin Corp is 2.91 times more volatile than Kennedy Wilson Holdings. It trades about 0.09 of its potential returns per unit of risk. Kennedy Wilson Holdings is currently generating about 0.06 per unit of risk. If you would invest 609.00 in Redfin Corp on August 28, 2024 and sell it today you would earn a total of 354.00 from holding Redfin Corp or generate 58.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Redfin Corp vs. Kennedy Wilson Holdings
Performance |
| Timeline |
| Redfin Corp |
| Kennedy Wilson Holdings |
Redfin Corp and Kennedy Wilson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Redfin Corp and Kennedy Wilson
The main advantage of trading using opposite Redfin Corp and Kennedy Wilson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Redfin Corp 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.| Redfin Corp vs. Offerpad Solutions | Redfin Corp vs. eXp World Holdings | Redfin Corp vs. Ohmyhome Limited Ordinary | Redfin Corp vs. Real Brokerage |
| Kennedy Wilson vs. Investcorp Credit Management | Kennedy Wilson vs. Medalist Diversified Reit | Kennedy Wilson vs. Aquagold International | Kennedy Wilson vs. Morningstar Unconstrained Allocation |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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