Correlation Between Kinetics Paradigm and Chase Growth
Can any of the company-specific risk be diversified away by investing in both Kinetics Paradigm and Chase 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 Chase 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 Chase Growth Fund, you can compare the effects of market volatilities on Kinetics Paradigm and Chase 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 Chase Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Paradigm and Chase Growth.
Diversification Opportunities for Kinetics Paradigm and Chase Growth
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Kinetics and Chase is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Paradigm Fund and Chase Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chase 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 Chase Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chase Growth has no effect on the direction of Kinetics Paradigm i.e., Kinetics Paradigm and Chase Growth go up and down completely randomly.
Pair Corralation between Kinetics Paradigm and Chase Growth
Assuming the 90 days horizon Kinetics Paradigm Fund is expected to generate 2.7 times more return on investment than Chase Growth. However, Kinetics Paradigm is 2.7 times more volatile than Chase Growth Fund. It trades about 0.4 of its potential returns per unit of risk. Chase Growth Fund is currently generating about 0.26 per unit of risk. If you would invest 9,848 in Kinetics Paradigm Fund on September 2, 2024 and sell it today you would earn a total of 7,517 from holding Kinetics Paradigm Fund or generate 76.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Paradigm Fund vs. Chase Growth Fund
Performance |
| Timeline |
| Kinetics Paradigm |
| Chase Growth |
Kinetics Paradigm and Chase Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Paradigm and Chase Growth
The main advantage of trading using opposite Kinetics Paradigm and Chase Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Paradigm position performs unexpectedly, Chase 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 Chase Growth will offset losses from the drop in Chase Growth's long position.| Kinetics Paradigm vs. Kinetics Global Fund | Kinetics Paradigm vs. Kinetics Global Fund | Kinetics Paradigm vs. Kinetics Internet Fund | Kinetics Paradigm vs. Kinetics Global Fund |
| Chase Growth vs. Tortoise Energy Independence | Chase Growth vs. Goehring Rozencwajg Resources | Chase Growth vs. World Energy Fund | Chase Growth vs. Short Oil Gas |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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