Correlation Between Kinetics Global and Alger Global
Can any of the company-specific risk be diversified away by investing in both Kinetics Global and Alger Global 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 Kinetics Global and Alger Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinetics Global Fund and Alger Global Growth, you can compare the effects of market volatilities on Kinetics Global and Alger Global 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 Kinetics Global with a short position of Alger Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Global and Alger Global.
Diversification Opportunities for Kinetics Global and Alger Global
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kinetics and Alger is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Global Fund and Alger Global Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alger Global Growth and Kinetics Global 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 Kinetics Global Fund are associated (or correlated) with Alger Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alger Global Growth has no effect on the direction of Kinetics Global i.e., Kinetics Global and Alger Global go up and down completely randomly.
Pair Corralation between Kinetics Global and Alger Global
Assuming the 90 days horizon Kinetics Global Fund is expected to generate 1.53 times more return on investment than Alger Global. However, Kinetics Global is 1.53 times more volatile than Alger Global Growth. It trades about 0.37 of its potential returns per unit of risk. Alger Global Growth is currently generating about 0.1 per unit of risk. If you would invest 1,184 in Kinetics Global Fund on August 28, 2024 and sell it today you would earn a total of 448.00 from holding Kinetics Global Fund or generate 37.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Global Fund vs. Alger Global Growth
Performance |
| Timeline |
| Kinetics Global |
| Alger Global Growth |
Kinetics Global and Alger Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Global and Alger Global
The main advantage of trading using opposite Kinetics Global and Alger Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Global position performs unexpectedly, Alger Global 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 Alger Global will offset losses from the drop in Alger Global's long position.| Kinetics Global vs. Kinetics Internet Fund | Kinetics Global vs. Kinetics Paradigm Fund | Kinetics Global vs. Jacob Internet Fund | Kinetics Global vs. Kinetics Small Cap |
| Alger Global vs. Alger Midcap Growth | Alger Global vs. Alger Midcap Growth | Alger Global vs. Alger Mid Cap | Alger Global vs. Alger Small Cap |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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