Correlation Between Kinetics Market and Maine Municipal
Can any of the company-specific risk be diversified away by investing in both Kinetics Market and Maine Municipal 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 Market and Maine Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinetics Market Opportunities and Maine Municipal Fund, you can compare the effects of market volatilities on Kinetics Market and Maine Municipal 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 Market with a short position of Maine Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Market and Maine Municipal.
Diversification Opportunities for Kinetics Market and Maine Municipal
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kinetics and Maine is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Market Opportunities and Maine Municipal Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maine Municipal and Kinetics Market 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 Market Opportunities are associated (or correlated) with Maine Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maine Municipal has no effect on the direction of Kinetics Market i.e., Kinetics Market and Maine Municipal go up and down completely randomly.
Pair Corralation between Kinetics Market and Maine Municipal
Assuming the 90 days horizon Kinetics Market Opportunities is expected to generate 6.28 times more return on investment than Maine Municipal. However, Kinetics Market is 6.28 times more volatile than Maine Municipal Fund. It trades about 0.53 of its potential returns per unit of risk. Maine Municipal Fund is currently generating about -0.04 per unit of risk. If you would invest 6,286 in Kinetics Market Opportunities on August 25, 2024 and sell it today you would earn a total of 3,697 from holding Kinetics Market Opportunities or generate 58.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Market Opportunities vs. Maine Municipal Fund
Performance |
| Timeline |
| Kinetics Market Oppo |
| Maine Municipal |
Kinetics Market and Maine Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Market and Maine Municipal
The main advantage of trading using opposite Kinetics Market and Maine Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Market position performs unexpectedly, Maine Municipal 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 Maine Municipal will offset losses from the drop in Maine Municipal's long position.| Kinetics Market vs. Kinetics Global Fund | Kinetics Market vs. Kinetics Global Fund | Kinetics Market vs. Kinetics Paradigm Fund | Kinetics Market 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 CEOs Directory module to screen CEOs from public companies around the world.
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