Correlation Between Horizon Kinetics and SPDR SP
Can any of the company-specific risk be diversified away by investing in both Horizon Kinetics and SPDR SP 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 SPDR SP 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 SPDR SP Transportation, you can compare the effects of market volatilities on Horizon Kinetics and SPDR SP 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 SPDR SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Horizon Kinetics and SPDR SP.
Diversification Opportunities for Horizon Kinetics and SPDR SP
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Horizon and SPDR is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Horizon Kinetics Medical and SPDR SP Transportation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SPDR SP Transportation 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 SPDR SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SPDR SP Transportation has no effect on the direction of Horizon Kinetics i.e., Horizon Kinetics and SPDR SP go up and down completely randomly.
Pair Corralation between Horizon Kinetics and SPDR SP
Given the investment horizon of 90 days Horizon Kinetics Medical is expected to under-perform the SPDR SP. But the etf apears to be less risky and, when comparing its historical volatility, Horizon Kinetics Medical is 1.59 times less risky than SPDR SP. The etf trades about -0.35 of its potential returns per unit of risk. The SPDR SP Transportation is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 8,492 in SPDR SP Transportation on August 27, 2024 and sell it today you would earn a total of 745.00 from holding SPDR SP Transportation or generate 8.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Horizon Kinetics Medical vs. SPDR SP Transportation
Performance |
| Timeline |
| Horizon Kinetics Medical |
| SPDR SP Transportation |
Horizon Kinetics and SPDR SP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Horizon Kinetics and SPDR SP
The main advantage of trading using opposite Horizon Kinetics and SPDR SP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Horizon Kinetics position performs unexpectedly, SPDR SP 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 SPDR SP will offset losses from the drop in SPDR SP's long position.| Horizon Kinetics vs. Harbor Health Care | Horizon Kinetics vs. Myriad Genetics | Horizon Kinetics vs. Genenta Science SpA |
| SPDR SP vs. First Trust Exchange Traded | SPDR SP vs. Ultimus Managers Trust | SPDR SP vs. Horizon Kinetics Medical | SPDR SP 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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