Correlation Between Kinetics Small and Cambiar International
Can any of the company-specific risk be diversified away by investing in both Kinetics Small and Cambiar 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 Cambiar 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 Cambiar International Equity, you can compare the effects of market volatilities on Kinetics Small and Cambiar 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 Cambiar International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Small and Cambiar International.
Diversification Opportunities for Kinetics Small and Cambiar International
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kinetics and Cambiar is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Small Cap and Cambiar International Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cambiar 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 Cambiar International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cambiar International has no effect on the direction of Kinetics Small i.e., Kinetics Small and Cambiar International go up and down completely randomly.
Pair Corralation between Kinetics Small and Cambiar International
Assuming the 90 days horizon Kinetics Small Cap is expected to generate 2.48 times more return on investment than Cambiar International. However, Kinetics Small is 2.48 times more volatile than Cambiar International Equity. It trades about 0.28 of its potential returns per unit of risk. Cambiar International Equity is currently generating about 0.0 per unit of risk. If you would invest 10,305 in Kinetics Small Cap on September 1, 2024 and sell it today you would earn a total of 9,885 from holding Kinetics Small Cap or generate 95.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 99.21% |
| Values | Daily Returns |
Kinetics Small Cap vs. Cambiar International Equity
Performance |
| Timeline |
| Kinetics Small Cap |
| Cambiar International |
Kinetics Small and Cambiar International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Small and Cambiar International
The main advantage of trading using opposite Kinetics Small and Cambiar International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Small position performs unexpectedly, Cambiar 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 Cambiar International will offset losses from the drop in Cambiar International's long position.| Kinetics Small vs. Kinetics Global Fund | Kinetics Small vs. Kinetics Paradigm Fund | Kinetics Small vs. Kinetics Internet Fund | Kinetics Small vs. Kinetics Global Fund |
| Cambiar International vs. Causeway Emerging Markets | Cambiar International vs. Cambiar Small Cap | Cambiar International vs. Pimco Short Term Fund | Cambiar International vs. Cambiar Opportunity Fund |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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