Correlation Between Kinetics Small and Bny Mellon
Can any of the company-specific risk be diversified away by investing in both Kinetics Small and Bny Mellon 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 Bny Mellon 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 Bny Mellon Emerging, you can compare the effects of market volatilities on Kinetics Small and Bny Mellon 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 Bny Mellon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Small and Bny Mellon.
Diversification Opportunities for Kinetics Small and Bny Mellon
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Kinetics and Bny is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Small Cap and Bny Mellon Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bny Mellon Emerging 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 Bny Mellon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bny Mellon Emerging has no effect on the direction of Kinetics Small i.e., Kinetics Small and Bny Mellon go up and down completely randomly.
Pair Corralation between Kinetics Small and Bny Mellon
Assuming the 90 days horizon Kinetics Small Cap is expected to generate 1.86 times more return on investment than Bny Mellon. However, Kinetics Small is 1.86 times more volatile than Bny Mellon Emerging. It trades about 0.05 of its potential returns per unit of risk. Bny Mellon Emerging is currently generating about 0.03 per unit of risk. If you would invest 13,549 in Kinetics Small Cap on September 14, 2024 and sell it today you would earn a total of 5,429 from holding Kinetics Small Cap or generate 40.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Small Cap vs. Bny Mellon Emerging
Performance |
| Timeline |
| Kinetics Small Cap |
| Bny Mellon Emerging |
Kinetics Small and Bny Mellon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Small and Bny Mellon
The main advantage of trading using opposite Kinetics Small and Bny Mellon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Small position performs unexpectedly, Bny Mellon 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 Bny Mellon will offset losses from the drop in Bny Mellon's long position.| Kinetics Small vs. Allianzgi Technology Fund | Kinetics Small vs. Dreyfus Technology Growth | Kinetics Small vs. Pgim Jennison Technology | Kinetics Small vs. Mfs Technology Fund |
| Bny Mellon vs. Vy Columbia Small | Bny Mellon vs. Touchstone Small Cap | Bny Mellon vs. Guidemark Smallmid Cap | Bny Mellon vs. Kinetics Small 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 Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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