Correlation Between Kinetics Paradigm and Lord Abbett
Can any of the company-specific risk be diversified away by investing in both Kinetics Paradigm and Lord Abbett 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 Lord Abbett 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 Lord Abbett Core, you can compare the effects of market volatilities on Kinetics Paradigm and Lord Abbett 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 Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Paradigm and Lord Abbett.
Diversification Opportunities for Kinetics Paradigm and Lord Abbett
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kinetics and Lord is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Paradigm Fund and Lord Abbett Core in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Core 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 Lord Abbett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lord Abbett Core has no effect on the direction of Kinetics Paradigm i.e., Kinetics Paradigm and Lord Abbett go up and down completely randomly.
Pair Corralation between Kinetics Paradigm and Lord Abbett
Assuming the 90 days horizon Kinetics Paradigm Fund is expected to generate 3.12 times more return on investment than Lord Abbett. However, Kinetics Paradigm is 3.12 times more volatile than Lord Abbett Core. It trades about 0.07 of its potential returns per unit of risk. Lord Abbett Core is currently generating about 0.04 per unit of risk. If you would invest 10,309 in Kinetics Paradigm Fund on September 3, 2024 and sell it today you would earn a total of 8,251 from holding Kinetics Paradigm Fund or generate 80.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Paradigm Fund vs. Lord Abbett Core
Performance |
| Timeline |
| Kinetics Paradigm |
| Lord Abbett Core |
Kinetics Paradigm and Lord Abbett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Paradigm and Lord Abbett
The main advantage of trading using opposite Kinetics Paradigm and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Paradigm position performs unexpectedly, Lord Abbett 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 Lord Abbett will offset losses from the drop in Lord Abbett's long position.| Kinetics Paradigm vs. Health Biotchnology Portfolio | Kinetics Paradigm vs. Delaware Healthcare Fund | Kinetics Paradigm vs. Lord Abbett Health | Kinetics Paradigm vs. Baillie Gifford Health |
| Lord Abbett vs. American Century Etf | Lord Abbett vs. Royce Opportunity Fund | Lord Abbett vs. Amg River Road | Lord Abbett vs. Queens Road 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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