Correlation Between Kinetics Market and Highland Floating
Can any of the company-specific risk be diversified away by investing in both Kinetics Market and Highland Floating 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 Highland Floating 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 Highland Floating Rate, you can compare the effects of market volatilities on Kinetics Market and Highland Floating 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 Highland Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Market and Highland Floating.
Diversification Opportunities for Kinetics Market and Highland Floating
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kinetics and Highland is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Market Opportunities and Highland Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Highland Floating Rate 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 Highland Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Highland Floating Rate has no effect on the direction of Kinetics Market i.e., Kinetics Market and Highland Floating go up and down completely randomly.
Pair Corralation between Kinetics Market and Highland Floating
Assuming the 90 days horizon Kinetics Market Opportunities is expected to generate 1.29 times more return on investment than Highland Floating. However, Kinetics Market is 1.29 times more volatile than Highland Floating Rate. It trades about 0.44 of its potential returns per unit of risk. Highland Floating Rate is currently generating about 0.1 per unit of risk. If you would invest 7,443 in Kinetics Market Opportunities on September 1, 2024 and sell it today you would earn a total of 2,235 from holding Kinetics Market Opportunities or generate 30.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Market Opportunities vs. Highland Floating Rate
Performance |
| Timeline |
| Kinetics Market Oppo |
| Highland Floating Rate |
Kinetics Market and Highland Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Market and Highland Floating
The main advantage of trading using opposite Kinetics Market and Highland Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Market position performs unexpectedly, Highland Floating 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 Highland Floating will offset losses from the drop in Highland Floating's long position.| Kinetics Market vs. Kinetics Market Opportunities | Kinetics Market vs. Kinetics Small Cap | Kinetics Market vs. Kinetics Paradigm Fund | Kinetics Market vs. Alger Capital Appreciation |
| Highland Floating vs. Neuberger Berman Next | Highland Floating vs. SRH Total Return | Highland Floating vs. Nuveen Municipal Credit | Highland Floating vs. Doubleline Income Solutions |
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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