Correlation Between Kinetics Small and Cardinal Small
Can any of the company-specific risk be diversified away by investing in both Kinetics Small and Cardinal Small 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 Cardinal Small 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 Cardinal Small Cap, you can compare the effects of market volatilities on Kinetics Small and Cardinal Small 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 Cardinal Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Small and Cardinal Small.
Diversification Opportunities for Kinetics Small and Cardinal Small
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kinetics and Cardinal is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Small Cap and Cardinal Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardinal Small Cap 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 Cardinal Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardinal Small Cap has no effect on the direction of Kinetics Small i.e., Kinetics Small and Cardinal Small go up and down completely randomly.
Pair Corralation between Kinetics Small and Cardinal Small
If you would invest 1,444 in Cardinal Small Cap on September 12, 2024 and sell it today you would earn a total of 0.00 from holding Cardinal Small Cap or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Small Cap vs. Cardinal Small Cap
Performance |
| Timeline |
| Kinetics Small Cap |
| Cardinal Small Cap |
Kinetics Small and Cardinal Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Small and Cardinal Small
The main advantage of trading using opposite Kinetics Small and Cardinal Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Small position performs unexpectedly, Cardinal Small 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 Cardinal Small will offset losses from the drop in Cardinal Small's long position.| Kinetics Small vs. Aqr Small Cap | Kinetics Small vs. Pace Smallmedium Value | Kinetics Small vs. Lebenthal Lisanti Small | Kinetics Small vs. Old Westbury Small |
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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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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