Correlation Between Horizon Kinetics and Themes Lithium
Can any of the company-specific risk be diversified away by investing in both Horizon Kinetics and Themes Lithium 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 Horizon Kinetics and Themes Lithium into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Horizon Kinetics Medical and Themes Lithium Battery, you can compare the effects of market volatilities on Horizon Kinetics and Themes Lithium 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 Horizon Kinetics with a short position of Themes Lithium. Check out your portfolio center. Please also check ongoing floating volatility patterns of Horizon Kinetics and Themes Lithium.
Diversification Opportunities for Horizon Kinetics and Themes Lithium
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Horizon and Themes is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Horizon Kinetics Medical and Themes Lithium Battery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Themes Lithium Battery and Horizon Kinetics 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 Horizon Kinetics Medical are associated (or correlated) with Themes Lithium. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Themes Lithium Battery has no effect on the direction of Horizon Kinetics i.e., Horizon Kinetics and Themes Lithium go up and down completely randomly.
Pair Corralation between Horizon Kinetics and Themes Lithium
Given the investment horizon of 90 days Horizon Kinetics Medical is expected to under-perform the Themes Lithium. But the etf apears to be less risky and, when comparing its historical volatility, Horizon Kinetics Medical is 1.96 times less risky than Themes Lithium. The etf trades about -0.3 of its potential returns per unit of risk. The Themes Lithium Battery is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 3,073 in Themes Lithium Battery on August 25, 2024 and sell it today you would earn a total of 32.00 from holding Themes Lithium Battery or generate 1.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Horizon Kinetics Medical vs. Themes Lithium Battery
Performance |
| Timeline |
| Horizon Kinetics Medical |
| Themes Lithium Battery |
Horizon Kinetics and Themes Lithium Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Horizon Kinetics and Themes Lithium
The main advantage of trading using opposite Horizon Kinetics and Themes Lithium positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Horizon Kinetics position performs unexpectedly, Themes Lithium 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 Themes Lithium will offset losses from the drop in Themes Lithium's long position.| Horizon Kinetics vs. Global X Clean | Horizon Kinetics vs. Global X Renewable | Horizon Kinetics vs. Global X Thematic | Horizon Kinetics vs. Global X AgTech |
| Themes Lithium vs. First Trust Exchange Traded | Themes Lithium vs. Ultimus Managers Trust | Themes Lithium vs. Horizon Kinetics Medical | Themes Lithium vs. Harbor Health Care |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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