Correlation Between Kinetics Market and Lifex Income
Can any of the company-specific risk be diversified away by investing in both Kinetics Market and Lifex Income 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 Lifex Income 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 Lifex Income, you can compare the effects of market volatilities on Kinetics Market and Lifex Income 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 Lifex Income. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Market and Lifex Income.
Diversification Opportunities for Kinetics Market and Lifex Income
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kinetics and Lifex is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Market Opportunities and Lifex Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifex Income 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 Lifex Income. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifex Income has no effect on the direction of Kinetics Market i.e., Kinetics Market and Lifex Income go up and down completely randomly.
Pair Corralation between Kinetics Market and Lifex Income
Assuming the 90 days horizon Kinetics Market Opportunities is expected to under-perform the Lifex Income. In addition to that, Kinetics Market is 5.06 times more volatile than Lifex Income. It trades about -0.06 of its total potential returns per unit of risk. Lifex Income is currently generating about 0.11 per unit of volatility. If you would invest 1,876 in Lifex Income on September 13, 2024 and sell it today you would earn a total of 31.00 from holding Lifex Income or generate 1.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Kinetics Market Opportunities vs. Lifex Income
Performance |
| Timeline |
| Kinetics Market Oppo |
| Lifex Income |
Kinetics Market and Lifex Income Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Market and Lifex Income
The main advantage of trading using opposite Kinetics Market and Lifex Income positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Market position performs unexpectedly, Lifex Income 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 Lifex Income will offset losses from the drop in Lifex Income's 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 |
| Lifex Income vs. Stone Ridge High | Lifex Income vs. Stone Ridge High | Lifex Income vs. Davidson Multi Cap Equity | Lifex Income vs. Fidelity Growth Income |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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