19.59 -0.19 (-0.96%) Buy

KW investors treading cautiously as performance is muted

13 min read

KENNEDY-WILSON HOLDINGS, INC. was among the worst performers on Friday. It lost -0.96% to close at 19.59. On a day when the overall market breadth was 35%, it closed higher than 16% of the market. In comparison, the benchmark SP500 index closed today at -0.0191%.

[Themes containing KW]

KW is currently in a up trend. Over the last three months trading long signals has not been a profitable strategy for KW's investors in general. However, this strategy had significantly lower risk when compared to Buy-and-Hold investing (which returned -7.38%). It is therefore better to tread with caution in the current uptrend by limiting your allocation to KW.


KW has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 10 days, KW underperformed the SP500 index on 51% days.

During the last three months KW was mostly loss making and delivered on average -0.11% per day. It's best return during this period (of +4.43%) was on Thursday, 1 Nov, 2018. While it's worst loss in the same period (of -3.71%) was on Friday, 26 Oct, 2018. There was initially a bullish trend during this period which started on 17 Sep, 2018 and went on till 20 Sep, 2018. The bullish trend returned +2.36% to investors. This was followed by a bearish trend that started on 3 Oct, 2018 and ended on 12 Oct, 2018. This bearish trend lost -10.55% of investor capital.

KW had 7 profitable and 5 loss making months over the last year. During the last year, KW underperformed SP500 index on monthly return basis. KW was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -10.77% compared to -7.28% returned by SP500 index in Oct 2018. KW had a shorter streak of profitable months than SP500 index. It only went up in 4 straight months during the last year.

"The real measure of your wealth is how much you'd be worth if you lost all your money

KW is becoming less volatile overall. In comparison, the SP500 index is seeing a rise in volatility. During the last three months, there was a significant surge in KW's volatility from 17 Sep, 2018 to 2 Nov, 2018. While there was a significant surge in the SP500 index's volatility from 25 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that KW has significant positive skewness in it's return distribution. This indicates that investors can expect KW to recover from drawdowns quickly. Which makes KW a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

KW has more chance of extreme outcomes than the SP500 index. Therefore, KW must receive a lower allocation than SP500 in your portfolio. SP500 index usually has shorter drawdown period than KW.

On a general note (since you are interested in KW), if you are an investor in VIPS, you need to be extra careful (consider limiting your exposure or diversifying) as it is extremely unpredictable and therefore risky.

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