Correlation Between Kinetics Global and Franklin Growth
Can any of the company-specific risk be diversified away by investing in both Kinetics Global and Franklin Growth 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 Franklin Growth 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 Franklin Growth Opportunities, you can compare the effects of market volatilities on Kinetics Global and Franklin Growth 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 Franklin Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Global and Franklin Growth.
Diversification Opportunities for Kinetics Global and Franklin Growth
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kinetics and Franklin is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Global Fund and Franklin Growth Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Growth Oppo 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 Franklin Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Growth Oppo has no effect on the direction of Kinetics Global i.e., Kinetics Global and Franklin Growth go up and down completely randomly.
Pair Corralation between Kinetics Global and Franklin Growth
Assuming the 90 days horizon Kinetics Global Fund is expected to generate 1.06 times more return on investment than Franklin Growth. However, Kinetics Global is 1.06 times more volatile than Franklin Growth Opportunities. It trades about 0.13 of its potential returns per unit of risk. Franklin Growth Opportunities is currently generating about 0.08 per unit of risk. If you would invest 769.00 in Kinetics Global Fund on September 3, 2024 and sell it today you would earn a total of 877.00 from holding Kinetics Global Fund or generate 114.04% 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. Franklin Growth Opportunities
Performance |
| Timeline |
| Kinetics Global |
| Franklin Growth Oppo |
Kinetics Global and Franklin Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Global and Franklin Growth
The main advantage of trading using opposite Kinetics Global and Franklin Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Global position performs unexpectedly, Franklin Growth 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 Franklin Growth will offset losses from the drop in Franklin Growth's long position.| Kinetics Global vs. Multisector Bond Sma | Kinetics Global vs. Blrc Sgy Mnp | Kinetics Global vs. Maryland Tax Free Bond | Kinetics Global vs. Ambrus Core Bond |
| Franklin Growth vs. Massmutual Select Diversified | Franklin Growth vs. Oklahoma College Savings | Franklin Growth vs. Rbc Emerging Markets | Franklin Growth vs. Kinetics Market Opportunities |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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