Correlation Between Kinetics Market and First Investors
Can any of the company-specific risk be diversified away by investing in both Kinetics Market and First Investors 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 First Investors 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 First Investors Select, you can compare the effects of market volatilities on Kinetics Market and First Investors 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 First Investors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Market and First Investors.
Diversification Opportunities for Kinetics Market and First Investors
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Kinetics and First is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Market Opportunities and First Investors Select in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Investors Select 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 First Investors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Investors Select has no effect on the direction of Kinetics Market i.e., Kinetics Market and First Investors go up and down completely randomly.
Pair Corralation between Kinetics Market and First Investors
Assuming the 90 days horizon Kinetics Market Opportunities is expected to under-perform the First Investors. In addition to that, Kinetics Market is 2.38 times more volatile than First Investors Select. It trades about -0.06 of its total potential returns per unit of risk. First Investors Select is currently generating about -0.04 per unit of volatility. If you would invest 1,358 in First Investors Select on September 13, 2024 and sell it today you would lose (18.00) from holding First Investors Select or give up 1.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Market Opportunities vs. First Investors Select
Performance |
| Timeline |
| Kinetics Market Oppo |
| First Investors Select |
Kinetics Market and First Investors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Market and First Investors
The main advantage of trading using opposite Kinetics Market and First Investors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Market position performs unexpectedly, First Investors 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 First Investors will offset losses from the drop in First Investors' long position.| Kinetics Market vs. Blackrock Science Technology | Kinetics Market vs. Biotechnology Ultrasector Profund | Kinetics Market vs. Pgim Jennison Technology | Kinetics Market vs. Technology Ultrasector Profund |
| First Investors vs. Guggenheim Managed Futures | First Investors vs. Goldman Sachs Inflation | First Investors vs. Short Duration Inflation | First Investors vs. Schwab Treasury Inflation |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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