Correlation Between Kennedy Wilson and Elbit Imaging

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

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

Diversification Opportunities for Kennedy Wilson and Elbit Imaging

-0.05

Correlation Coefficient

Kennedy Wilson  Elbit Imaging

Good diversification

The 3 months correlation between Kennedy and Elbit is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Kennedy Wilson Holdings and Elbit Imaging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elbit Imaging and Kennedy Wilson 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 Kennedy Wilson Holdings are associated (or correlated) with Elbit Imaging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elbit Imaging has no effect on the direction of Kennedy Wilson i.e., Kennedy Wilson and Elbit Imaging go up and down completely randomly.

Pair Corralation between Kennedy Wilson and Elbit Imaging

If you would invest  824.00  in Kennedy Wilson Holdings on February 5, 2024 and sell it today you would earn a total of  51.00  from holding Kennedy Wilson Holdings or generate 6.19% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	4.55%
Values	Daily Returns

Kennedy Wilson Holdings  vs.  Elbit Imaging

Kennedy Wilson Holdings

Risk-Adjusted Performance

0 of 100

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 fairly stable basic indicators, Kennedy Wilson is not utilizing all of its potentials. The recent stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Elbit Imaging

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Elbit Imaging has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Elbit Imaging is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Kennedy Wilson and Elbit Imaging

The main advantage of trading using opposite Kennedy Wilson and Elbit Imaging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kennedy Wilson position performs unexpectedly, Elbit Imaging 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 Elbit Imaging will offset losses from the drop in Elbit Imaging's long position.

The idea behind Kennedy Wilson Holdings and Elbit Imaging 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.

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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.