Correlation Between Kinetics Paradigm and Americafirst Large
Can any of the company-specific risk be diversified away by investing in both Kinetics Paradigm and Americafirst Large 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 Americafirst Large 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 Americafirst Large Cap, you can compare the effects of market volatilities on Kinetics Paradigm and Americafirst Large 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 Americafirst Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Paradigm and Americafirst Large.
Diversification Opportunities for Kinetics Paradigm and Americafirst Large
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Kinetics and Americafirst is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Paradigm Fund and Americafirst Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Americafirst Large Cap 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 Americafirst Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Americafirst Large Cap has no effect on the direction of Kinetics Paradigm i.e., Kinetics Paradigm and Americafirst Large go up and down completely randomly.
Pair Corralation between Kinetics Paradigm and Americafirst Large
Assuming the 90 days horizon Kinetics Paradigm Fund is expected to generate 2.69 times more return on investment than Americafirst Large. However, Kinetics Paradigm is 2.69 times more volatile than Americafirst Large Cap. It trades about 0.48 of its potential returns per unit of risk. Americafirst Large Cap is currently generating about 0.2 per unit of risk. If you would invest 11,374 in Kinetics Paradigm Fund on August 30, 2024 and sell it today you would earn a total of 7,525 from holding Kinetics Paradigm Fund or generate 66.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 97.73% |
| Values | Daily Returns |
Kinetics Paradigm Fund vs. Americafirst Large Cap
Performance |
| Timeline |
| Kinetics Paradigm |
| Americafirst Large Cap |
Kinetics Paradigm and Americafirst Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Paradigm and Americafirst Large
The main advantage of trading using opposite Kinetics Paradigm and Americafirst Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Paradigm position performs unexpectedly, Americafirst Large 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 Americafirst Large will offset losses from the drop in Americafirst Large's long position.| Kinetics Paradigm vs. Rational Defensive Growth | Kinetics Paradigm vs. T Rowe Price | Kinetics Paradigm vs. Growth Fund Of | Kinetics Paradigm vs. T Rowe Price |
| Americafirst Large vs. Qs Large Cap | Americafirst Large vs. Dana Large Cap | Americafirst Large vs. Cb Large Cap | Americafirst Large vs. Tax Managed Large 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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