Correlation Between Xinyuan Real and Kaanapali Land
Can any of the company-specific risk be diversified away by investing in both Xinyuan Real and Kaanapali Land 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 Xinyuan Real and Kaanapali Land into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Xinyuan Real Estate and Kaanapali Land LLC, you can compare the effects of market volatilities on Xinyuan Real and Kaanapali Land 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 Xinyuan Real with a short position of Kaanapali Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xinyuan Real and Kaanapali Land.
Diversification Opportunities for Xinyuan Real and Kaanapali Land
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Xinyuan and Kaanapali is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Xinyuan Real Estate and Kaanapali Land LLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kaanapali Land LLC and Xinyuan Real 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 Xinyuan Real Estate are associated (or correlated) with Kaanapali Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kaanapali Land LLC has no effect on the direction of Xinyuan Real i.e., Xinyuan Real and Kaanapali Land go up and down completely randomly.
Pair Corralation between Xinyuan Real and Kaanapali Land
Considering the 90-day investment horizon Xinyuan Real is expected to generate 2.17 times less return on investment than Kaanapali Land. In addition to that, Xinyuan Real is 2.27 times more volatile than Kaanapali Land LLC. It trades about 0.01 of its total potential returns per unit of risk. Kaanapali Land LLC is currently generating about 0.07 per unit of volatility. If you would invest 2,400 in Kaanapali Land LLC on August 30, 2024 and sell it today you would earn a total of 1,800 from holding Kaanapali Land LLC or generate 75.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xinyuan Real Estate vs. Kaanapali Land LLC
Performance |
| Timeline |
| Xinyuan Real Estate |
| Kaanapali Land LLC |
Xinyuan Real and Kaanapali Land Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xinyuan Real and Kaanapali Land
The main advantage of trading using opposite Xinyuan Real and Kaanapali Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xinyuan Real position performs unexpectedly, Kaanapali Land 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 Kaanapali Land will offset losses from the drop in Kaanapali Land's long position.| Xinyuan Real vs. AMREP | Xinyuan Real vs. Alset Ehome International | Xinyuan Real vs. Landsea Homes Corp | Xinyuan Real vs. Bayport International Holdings |
| Kaanapali Land vs. Xinyuan Real Estate | Kaanapali Land vs. AMREP | Kaanapali Land vs. Alset Ehome International | Kaanapali Land vs. Landsea Homes 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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