Correlation Between Kinetics Small and Thornburg International
Can any of the company-specific risk be diversified away by investing in both Kinetics Small and Thornburg International 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 Small and Thornburg International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinetics Small Cap and Thornburg International Value, you can compare the effects of market volatilities on Kinetics Small and Thornburg International 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 Small with a short position of Thornburg International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Small and Thornburg International.
Diversification Opportunities for Kinetics Small and Thornburg International
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kinetics and Thornburg is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Small Cap and Thornburg International Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Thornburg International and Kinetics Small 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 Small Cap are associated (or correlated) with Thornburg International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Thornburg International has no effect on the direction of Kinetics Small i.e., Kinetics Small and Thornburg International go up and down completely randomly.
Pair Corralation between Kinetics Small and Thornburg International
Assuming the 90 days horizon Kinetics Small Cap is expected to generate 1.96 times more return on investment than Thornburg International. However, Kinetics Small is 1.96 times more volatile than Thornburg International Value. It trades about 0.08 of its potential returns per unit of risk. Thornburg International Value is currently generating about 0.06 per unit of risk. If you would invest 13,382 in Kinetics Small Cap on September 2, 2024 and sell it today you would earn a total of 8,839 from holding Kinetics Small Cap or generate 66.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Small Cap vs. Thornburg International Value
Performance |
| Timeline |
| Kinetics Small Cap |
| Thornburg International |
Kinetics Small and Thornburg International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Small and Thornburg International
The main advantage of trading using opposite Kinetics Small and Thornburg International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Small position performs unexpectedly, Thornburg International 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 Thornburg International will offset losses from the drop in Thornburg International's long position.| Kinetics Small vs. Kinetics Paradigm Fund | Kinetics Small vs. Kinetics Market Opportunities | Kinetics Small vs. Pear Tree Polaris | Kinetics Small vs. Amg Managers Loomis |
| Thornburg International vs. Thornburg E Growth | Thornburg International vs. Mainstay Large Cap | Thornburg International vs. Allianzgi Nfj Small Cap | Thornburg International vs. Columbia Mid 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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