Correlation Between Kinetics Market and Payden Emerging
Can any of the company-specific risk be diversified away by investing in both Kinetics Market and Payden Emerging 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 Payden Emerging 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 Payden Emerging Markets, you can compare the effects of market volatilities on Kinetics Market and Payden Emerging 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 Payden Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Market and Payden Emerging.
Diversification Opportunities for Kinetics Market and Payden Emerging
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kinetics and Payden is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Market Opportunities and Payden Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Payden Emerging Markets 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 Payden Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Payden Emerging Markets has no effect on the direction of Kinetics Market i.e., Kinetics Market and Payden Emerging go up and down completely randomly.
Pair Corralation between Kinetics Market and Payden Emerging
Assuming the 90 days horizon Kinetics Market Opportunities is expected to generate 5.56 times more return on investment than Payden Emerging. However, Kinetics Market is 5.56 times more volatile than Payden Emerging Markets. It trades about 0.45 of its potential returns per unit of risk. Payden Emerging Markets is currently generating about -0.09 per unit of risk. If you would invest 7,170 in Kinetics Market Opportunities on August 29, 2024 and sell it today you would earn a total of 2,275 from holding Kinetics Market Opportunities or generate 31.73% 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. Payden Emerging Markets
Performance |
| Timeline |
| Kinetics Market Oppo |
| Payden Emerging Markets |
Kinetics Market and Payden Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Market and Payden Emerging
The main advantage of trading using opposite Kinetics Market and Payden Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Market position performs unexpectedly, Payden Emerging 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 Payden Emerging will offset losses from the drop in Payden Emerging'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 |
| Payden Emerging vs. Fidelity Managed Retirement | Payden Emerging vs. Target Retirement 2040 | Payden Emerging vs. Blackrock Moderate Prepared | Payden Emerging vs. Wisdomtree Siegel Moderate |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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