Correlation Between Sterling Capital and Kinetics Small
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Kinetics Small 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 Sterling Capital and Kinetics Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Capital Behavioral and Kinetics Small Cap, you can compare the effects of market volatilities on Sterling Capital and Kinetics Small 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 Sterling Capital with a short position of Kinetics Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Kinetics Small.
Diversification Opportunities for Sterling Capital and Kinetics Small
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Sterling and Kinetics is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Behavioral and Kinetics Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinetics Small Cap and Sterling Capital 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 Sterling Capital Behavioral are associated (or correlated) with Kinetics Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinetics Small Cap has no effect on the direction of Sterling Capital i.e., Sterling Capital and Kinetics Small go up and down completely randomly.
Pair Corralation between Sterling Capital and Kinetics Small
Assuming the 90 days horizon Sterling Capital is expected to generate 5.0 times less return on investment than Kinetics Small. But when comparing it to its historical volatility, Sterling Capital Behavioral is 1.95 times less risky than Kinetics Small. It trades about 0.06 of its potential returns per unit of risk. Kinetics Small Cap is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 10,102 in Kinetics Small Cap on September 2, 2024 and sell it today you would earn a total of 12,696 from holding Kinetics Small Cap or generate 125.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sterling Capital Behavioral vs. Kinetics Small Cap
Performance |
| Timeline |
| Sterling Capital Beh |
| Kinetics Small Cap |
Sterling Capital and Kinetics Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Kinetics Small
The main advantage of trading using opposite Sterling Capital and Kinetics Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Kinetics Small 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 Kinetics Small will offset losses from the drop in Kinetics Small's long position.| Sterling Capital vs. Calvert Conservative Allocation | Sterling Capital vs. Adams Diversified Equity | Sterling Capital vs. Evaluator Conservative Rms | Sterling Capital vs. Western Asset Diversified |
| Kinetics Small vs. Kinetics Paradigm Fund | Kinetics Small vs. Kinetics Market Opportunities | Kinetics Small vs. Pear Tree Polaris | Kinetics Small vs. Amg Managers Loomis |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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