Correlation Between SkyCity Entertainment and Kenon Holdings
Can any of the company-specific risk be diversified away by investing in both SkyCity Entertainment and Kenon 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 SkyCity Entertainment and Kenon Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SkyCity Entertainment Group and Kenon Holdings, you can compare the effects of market volatilities on SkyCity Entertainment and Kenon 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 SkyCity Entertainment with a short position of Kenon Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of SkyCity Entertainment and Kenon Holdings.
Diversification Opportunities for SkyCity Entertainment and Kenon Holdings
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between SkyCity and Kenon is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding SkyCity Entertainment Group and Kenon Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kenon Holdings and SkyCity Entertainment 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 SkyCity Entertainment Group are associated (or correlated) with Kenon Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kenon Holdings has no effect on the direction of SkyCity Entertainment i.e., SkyCity Entertainment and Kenon Holdings go up and down completely randomly.
Pair Corralation between SkyCity Entertainment and Kenon Holdings
Assuming the 90 days horizon SkyCity Entertainment Group is expected to under-perform the Kenon Holdings. In addition to that, SkyCity Entertainment is 1.25 times more volatile than Kenon Holdings. It trades about -0.05 of its total potential returns per unit of risk. Kenon Holdings is currently generating about 0.06 per unit of volatility. If you would invest 1,803 in Kenon Holdings on November 2, 2024 and sell it today you would earn a total of 1,282 from holding Kenon Holdings or generate 71.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 69.23% |
| Values | Daily Returns |
SkyCity Entertainment Group vs. Kenon Holdings
Performance |
| Timeline |
| SkyCity Entertainment |
| Kenon Holdings |
SkyCity Entertainment and Kenon Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SkyCity Entertainment and Kenon Holdings
The main advantage of trading using opposite SkyCity Entertainment and Kenon Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SkyCity Entertainment position performs unexpectedly, Kenon 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 Kenon Holdings will offset losses from the drop in Kenon Holdings' long position.| SkyCity Entertainment vs. Nagacorp | SkyCity Entertainment vs. Wynn Macau | SkyCity Entertainment vs. MGM China Holdings | SkyCity Entertainment vs. Table Trac |
| Kenon Holdings vs. Vistra Energy Corp | Kenon Holdings vs. Pampa Energia SA | Kenon Holdings vs. NRG Energy | Kenon Holdings vs. TransAlta Corp |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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