Correlation Between Kinetics Global and Income Fund
Can any of the company-specific risk be diversified away by investing in both Kinetics Global and Income Fund 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 Income Fund 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 Income Fund Of, you can compare the effects of market volatilities on Kinetics Global and Income Fund 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 Income Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Global and Income Fund.
Diversification Opportunities for Kinetics Global and Income Fund
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kinetics and Income is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Global Fund and Income Fund Of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Income Fund 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 Income Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Income Fund has no effect on the direction of Kinetics Global i.e., Kinetics Global and Income Fund go up and down completely randomly.
Pair Corralation between Kinetics Global and Income Fund
Assuming the 90 days horizon Kinetics Global Fund is expected to generate 3.59 times more return on investment than Income Fund. However, Kinetics Global is 3.59 times more volatile than Income Fund Of. It trades about 0.4 of its potential returns per unit of risk. Income Fund Of is currently generating about 0.14 per unit of risk. If you would invest 1,154 in Kinetics Global Fund on September 2, 2024 and sell it today you would earn a total of 492.00 from holding Kinetics Global Fund or generate 42.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Global Fund vs. Income Fund Of
Performance |
| Timeline |
| Kinetics Global |
| Income Fund |
Kinetics Global and Income Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Global and Income Fund
The main advantage of trading using opposite Kinetics Global and Income Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Global position performs unexpectedly, Income Fund 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 Income Fund will offset losses from the drop in Income Fund's long position.| Kinetics Global vs. Kinetics Paradigm Fund | Kinetics Global vs. Kinetics Internet Fund | Kinetics Global vs. Kinetics Global Fund | Kinetics Global vs. Kinetics Internet Fund |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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