Correlation Between Kinetics Paradigm and Baron Growth
Can any of the company-specific risk be diversified away by investing in both Kinetics Paradigm and Baron Growth 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 Paradigm and Baron Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinetics Paradigm Fund and Baron Growth Fund, you can compare the effects of market volatilities on Kinetics Paradigm and Baron Growth 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 Paradigm with a short position of Baron Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Paradigm and Baron Growth.
Diversification Opportunities for Kinetics Paradigm and Baron Growth
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kinetics and Baron is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Paradigm Fund and Baron Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baron Growth and Kinetics Paradigm 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 Paradigm Fund are associated (or correlated) with Baron Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baron Growth has no effect on the direction of Kinetics Paradigm i.e., Kinetics Paradigm and Baron Growth go up and down completely randomly.
Pair Corralation between Kinetics Paradigm and Baron Growth
Assuming the 90 days horizon Kinetics Paradigm Fund is expected to generate 3.95 times more return on investment than Baron Growth. However, Kinetics Paradigm is 3.95 times more volatile than Baron Growth Fund. It trades about 0.44 of its potential returns per unit of risk. Baron Growth Fund is currently generating about 0.35 per unit of risk. If you would invest 13,200 in Kinetics Paradigm Fund on September 1, 2024 and sell it today you would earn a total of 4,483 from holding Kinetics Paradigm Fund or generate 33.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Kinetics Paradigm Fund vs. Baron Growth Fund
Performance |
| Timeline |
| Kinetics Paradigm |
| Baron Growth |
Kinetics Paradigm and Baron Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Paradigm and Baron Growth
The main advantage of trading using opposite Kinetics Paradigm and Baron Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Paradigm position performs unexpectedly, Baron Growth 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 Baron Growth will offset losses from the drop in Baron Growth's long position.| Kinetics Paradigm vs. Goldman Sachs Technology | Kinetics Paradigm vs. Dreyfus Technology Growth | Kinetics Paradigm vs. Science Technology Fund | Kinetics Paradigm vs. Allianzgi Technology Fund |
| Baron Growth vs. Baron Real Estate | Baron Growth vs. Baron Real Estate | Baron Growth vs. Baron Real Estate | Baron Growth vs. Baron Small Cap |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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