Correlation Between Kinetics Small and Dunham Emerging
Can any of the company-specific risk be diversified away by investing in both Kinetics Small and Dunham Emerging 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 Dunham Emerging 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 Dunham Emerging Markets, you can compare the effects of market volatilities on Kinetics Small and Dunham Emerging 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 Dunham Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Small and Dunham Emerging.
Diversification Opportunities for Kinetics Small and Dunham Emerging
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kinetics and Dunham is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Small Cap and Dunham Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dunham Emerging Markets 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 Dunham Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dunham Emerging Markets has no effect on the direction of Kinetics Small i.e., Kinetics Small and Dunham Emerging go up and down completely randomly.
Pair Corralation between Kinetics Small and Dunham Emerging
Assuming the 90 days horizon Kinetics Small Cap is expected to generate 1.64 times more return on investment than Dunham Emerging. However, Kinetics Small is 1.64 times more volatile than Dunham Emerging Markets. It trades about 0.18 of its potential returns per unit of risk. Dunham Emerging Markets is currently generating about 0.02 per unit of risk. If you would invest 18,066 in Kinetics Small Cap on November 3, 2024 and sell it today you would earn a total of 1,088 from holding Kinetics Small Cap or generate 6.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Small Cap vs. Dunham Emerging Markets
Performance |
| Timeline |
| Kinetics Small Cap |
| Dunham Emerging Markets |
Kinetics Small and Dunham Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Small and Dunham Emerging
The main advantage of trading using opposite Kinetics Small and Dunham Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Small position performs unexpectedly, Dunham Emerging 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 Dunham Emerging will offset losses from the drop in Dunham Emerging's long position.| Kinetics Small vs. Goldman Sachs Financial | Kinetics Small vs. Financial Industries Fund | Kinetics Small vs. Blackstone Secured Lending | Kinetics Small vs. Prudential Financial Services |
| Dunham Emerging vs. Gmo Global Equity | Dunham Emerging vs. Doubleline Core Fixed | Dunham Emerging vs. Small Cap Equity | Dunham Emerging vs. Dws Equity Sector |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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