Correlation Between First Investors and Kinetics Market
Can any of the company-specific risk be diversified away by investing in both First Investors and Kinetics Market 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 First Investors and Kinetics Market into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between First Investors Select and Kinetics Market Opportunities, you can compare the effects of market volatilities on First Investors and Kinetics Market 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 First Investors with a short position of Kinetics Market. Check out your portfolio center. Please also check ongoing floating volatility patterns of First Investors and Kinetics Market.
Diversification Opportunities for First Investors and Kinetics Market
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between First and Kinetics is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding First Investors Select and Kinetics Market Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinetics Market Oppo and First Investors 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 First Investors Select are associated (or correlated) with Kinetics Market. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinetics Market Oppo has no effect on the direction of First Investors i.e., First Investors and Kinetics Market go up and down completely randomly.
Pair Corralation between First Investors and Kinetics Market
Assuming the 90 days horizon First Investors is expected to generate 6.54 times less return on investment than Kinetics Market. But when comparing it to its historical volatility, First Investors Select is 1.86 times less risky than Kinetics Market. It trades about 0.16 of its potential returns per unit of risk. Kinetics Market Opportunities is currently generating about 0.56 of returns per unit of risk over similar time horizon. If you would invest 7,214 in Kinetics Market Opportunities on October 24, 2024 and sell it today you would earn a total of 1,250 from holding Kinetics Market Opportunities or generate 17.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
First Investors Select vs. Kinetics Market Opportunities
Performance |
| Timeline |
| First Investors Select |
| Kinetics Market Oppo |
First Investors and Kinetics Market Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with First Investors and Kinetics Market
The main advantage of trading using opposite First Investors and Kinetics Market positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if First Investors position performs unexpectedly, Kinetics Market 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 Kinetics Market will offset losses from the drop in Kinetics Market's long position.| First Investors vs. Black Oak Emerging | First Investors vs. Catalystmillburn Hedge Strategy | First Investors vs. Barings Emerging Markets | First Investors vs. Mid Cap 15x Strategy |
| Kinetics Market vs. Fidelity Focused High | Kinetics Market vs. Multi Manager High Yield | Kinetics Market vs. Gmo High Yield | Kinetics Market vs. Lord Abbett Short |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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