Correlation Between Kinetics Paradigm and Gotham Enhanced
Can any of the company-specific risk be diversified away by investing in both Kinetics Paradigm and Gotham Enhanced 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 Gotham Enhanced 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 Gotham Enhanced 500, you can compare the effects of market volatilities on Kinetics Paradigm and Gotham Enhanced 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 Gotham Enhanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Paradigm and Gotham Enhanced.
Diversification Opportunities for Kinetics Paradigm and Gotham Enhanced
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kinetics and Gotham is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Paradigm Fund and Gotham Enhanced 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gotham Enhanced 500 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 Gotham Enhanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gotham Enhanced 500 has no effect on the direction of Kinetics Paradigm i.e., Kinetics Paradigm and Gotham Enhanced go up and down completely randomly.
Pair Corralation between Kinetics Paradigm and Gotham Enhanced
Assuming the 90 days horizon Kinetics Paradigm Fund is expected to generate 3.92 times more return on investment than Gotham Enhanced. However, Kinetics Paradigm is 3.92 times more volatile than Gotham Enhanced 500. It trades about 0.47 of its potential returns per unit of risk. Gotham Enhanced 500 is currently generating about 0.19 per unit of risk. If you would invest 11,416 in Kinetics Paradigm Fund on August 30, 2024 and sell it today you would earn a total of 4,354 from holding Kinetics Paradigm Fund or generate 38.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Paradigm Fund vs. Gotham Enhanced 500
Performance |
| Timeline |
| Kinetics Paradigm |
| Gotham Enhanced 500 |
Kinetics Paradigm and Gotham Enhanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Paradigm and Gotham Enhanced
The main advantage of trading using opposite Kinetics Paradigm and Gotham Enhanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Paradigm position performs unexpectedly, Gotham Enhanced 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 Gotham Enhanced will offset losses from the drop in Gotham Enhanced's long position.| Kinetics Paradigm vs. Fidelity Series Government | Kinetics Paradigm vs. Us Government Securities | Kinetics Paradigm vs. Us Government Securities | Kinetics Paradigm vs. John Hancock Government |
| Gotham Enhanced vs. Pgim Jennison Diversified | Gotham Enhanced vs. Tax Managed Mid Small | Gotham Enhanced vs. Blackrock Sm Cap | Gotham Enhanced vs. The Gabelli Small |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |