Correlation Between Sitka Gold and Kinetics Internet
Can any of the company-specific risk be diversified away by investing in both Sitka Gold and Kinetics Internet 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 Sitka Gold and Kinetics Internet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sitka Gold Corp and Kinetics Internet Fund, you can compare the effects of market volatilities on Sitka Gold and Kinetics Internet 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 Sitka Gold with a short position of Kinetics Internet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sitka Gold and Kinetics Internet.
Diversification Opportunities for Sitka Gold and Kinetics Internet
0.34 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sitka and Kinetics is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Sitka Gold Corp and Kinetics Internet Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinetics Internet and Sitka Gold 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 Sitka Gold Corp are associated (or correlated) with Kinetics Internet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinetics Internet has no effect on the direction of Sitka Gold i.e., Sitka Gold and Kinetics Internet go up and down completely randomly.
Pair Corralation between Sitka Gold and Kinetics Internet
Assuming the 90 days horizon Sitka Gold is expected to generate 2.57 times less return on investment than Kinetics Internet. In addition to that, Sitka Gold is 3.7 times more volatile than Kinetics Internet Fund. It trades about 0.05 of its total potential returns per unit of risk. Kinetics Internet Fund is currently generating about 0.44 per unit of volatility. If you would invest 8,344 in Kinetics Internet Fund on August 25, 2024 and sell it today you would earn a total of 3,699 from holding Kinetics Internet Fund or generate 44.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sitka Gold Corp vs. Kinetics Internet Fund
Performance |
| Timeline |
| Sitka Gold Corp |
| Kinetics Internet |
Sitka Gold and Kinetics Internet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sitka Gold and Kinetics Internet
The main advantage of trading using opposite Sitka Gold and Kinetics Internet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sitka Gold position performs unexpectedly, Kinetics Internet 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 Internet will offset losses from the drop in Kinetics Internet's long position.| Sitka Gold vs. Aurion Resources | Sitka Gold vs. Minera Alamos | Sitka Gold vs. Rio2 Limited | Sitka Gold vs. Roscan Gold Corp |
| Kinetics Internet vs. Kinetics Global Fund | Kinetics Internet vs. Kinetics Global Fund | Kinetics Internet vs. Kinetics Paradigm Fund | Kinetics Internet vs. Kinetics Global 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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