Correlation Between Kinetics Small and Nationwide Highmark
Can any of the company-specific risk be diversified away by investing in both Kinetics Small and Nationwide Highmark 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 Nationwide Highmark 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 Nationwide Highmark Short, you can compare the effects of market volatilities on Kinetics Small and Nationwide Highmark 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 Nationwide Highmark. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Small and Nationwide Highmark.
Diversification Opportunities for Kinetics Small and Nationwide Highmark
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kinetics and Nationwide is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Small Cap and Nationwide Highmark Short in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nationwide Highmark Short 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 Nationwide Highmark. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nationwide Highmark Short has no effect on the direction of Kinetics Small i.e., Kinetics Small and Nationwide Highmark go up and down completely randomly.
Pair Corralation between Kinetics Small and Nationwide Highmark
Assuming the 90 days horizon Kinetics Small Cap is expected to generate 10.1 times more return on investment than Nationwide Highmark. However, Kinetics Small is 10.1 times more volatile than Nationwide Highmark Short. It trades about 0.05 of its potential returns per unit of risk. Nationwide Highmark Short is currently generating about 0.16 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 Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Small Cap vs. Nationwide Highmark Short
Performance |
| Timeline |
| Kinetics Small Cap |
| Nationwide Highmark Short |
Kinetics Small and Nationwide Highmark Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Small and Nationwide Highmark
The main advantage of trading using opposite Kinetics Small and Nationwide Highmark positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Small position performs unexpectedly, Nationwide Highmark 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 Nationwide Highmark will offset losses from the drop in Nationwide Highmark'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 |
| Nationwide Highmark vs. Df Dent Small | Nationwide Highmark vs. Small Pany Growth | Nationwide Highmark vs. Kinetics Small Cap | Nationwide Highmark vs. Pace Smallmedium Value |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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