Correlation Between Kenon Holdings and Celsius Holdings

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Can any of the company-specific risk be diversified away by investing in both Kenon Holdings and Celsius 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 Celsius 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 Celsius Holdings, you can compare the effects of market volatilities on Kenon Holdings and Celsius 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 Celsius Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kenon Holdings and Celsius Holdings.

Diversification Opportunities for Kenon Holdings and Celsius Holdings

-0.6
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Kenon and Celsius is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Kenon Holdings and Celsius Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Celsius 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 Celsius Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Celsius Holdings has no effect on the direction of Kenon Holdings i.e., Kenon Holdings and Celsius Holdings go up and down completely randomly.

Pair Corralation between Kenon Holdings and Celsius Holdings

Considering the 90-day investment horizon Kenon Holdings is expected to generate 0.43 times more return on investment than Celsius Holdings. However, Kenon Holdings is 2.32 times less risky than Celsius Holdings. It trades about 0.16 of its potential returns per unit of risk. Celsius Holdings is currently generating about -0.04 per unit of risk. If you would invest  2,719  in Kenon Holdings on September 27, 2024 and sell it today you would earn a total of  496.00  from holding Kenon Holdings or generate 18.24% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Kenon Holdings  vs.  Celsius Holdings

 Performance 
       Timeline  
Kenon Holdings 

Risk-Adjusted Performance

12 of 100

 
Weak
 
Strong
OK
Compared to the overall equity markets, risk-adjusted returns on investments in Kenon Holdings are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very uncertain technical and fundamental indicators, Kenon Holdings displayed solid returns over the last few months and may actually be approaching a breakup point.
Celsius Holdings 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Celsius Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unfluctuating performance, the Stock's essential indicators remain strong and the recent confusion on Wall Street may also be a sign of long-lasting gains for the firm traders.

Kenon Holdings and Celsius Holdings Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Kenon Holdings and Celsius Holdings

The main advantage of trading using opposite Kenon Holdings and Celsius Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kenon Holdings position performs unexpectedly, Celsius 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 Celsius Holdings will offset losses from the drop in Celsius Holdings' long position.
The idea behind Kenon Holdings and Celsius Holdings 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.

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