Correlation Between Horizon Kinetics and VictoryShares THB

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Can any of the company-specific risk be diversified away by investing in both Horizon Kinetics and VictoryShares THB 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 VictoryShares THB into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Horizon Kinetics SPAC and VictoryShares THB Mid, you can compare the effects of market volatilities on Horizon Kinetics and VictoryShares THB 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 VictoryShares THB. Check out your portfolio center. Please also check ongoing floating volatility patterns of Horizon Kinetics and VictoryShares THB.

Diversification Opportunities for Horizon Kinetics and VictoryShares THB

HorizonVictorySharesDiversified AwayHorizonVictorySharesDiversified Away100%
-0.77
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Horizon and VictoryShares is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Horizon Kinetics SPAC and VictoryShares THB Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VictoryShares THB Mid 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 SPAC are associated (or correlated) with VictoryShares THB. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VictoryShares THB Mid has no effect on the direction of Horizon Kinetics i.e., Horizon Kinetics and VictoryShares THB go up and down completely randomly.

Pair Corralation between Horizon Kinetics and VictoryShares THB

Given the investment horizon of 90 days Horizon Kinetics SPAC is expected to generate 0.44 times more return on investment than VictoryShares THB. However, Horizon Kinetics SPAC is 2.28 times less risky than VictoryShares THB. It trades about 0.18 of its potential returns per unit of risk. VictoryShares THB Mid is currently generating about -0.5 per unit of risk. If you would invest  9,857  in Horizon Kinetics SPAC on November 25, 2024 and sell it today you would earn a total of  112.00  from holding Horizon Kinetics SPAC or generate 1.14% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Horizon Kinetics SPAC  vs.  VictoryShares THB Mid

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -8-6-4-2024
JavaScript chart by amCharts 3.21.15SPAQ MDCP
       Timeline  
Horizon Kinetics SPAC 

Risk-Adjusted Performance

Good

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Horizon Kinetics SPAC are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Horizon Kinetics is not utilizing all of its potentials. The current stock price agitation, may contribute to short-term losses for the retail investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb96.59797.59898.59999.5
VictoryShares THB Mid 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days VictoryShares THB Mid has generated negative risk-adjusted returns adding no value to investors with long positions. Even with weak performance in the last few months, the Etf's fundamental indicators remain relatively invariable which may send shares a bit higher in March 2025. The latest agitation may also be a sign of long-running up-swing for the ETF retail investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb2727.52828.52929.53030.531

Horizon Kinetics and VictoryShares THB Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-0.64-0.41-0.18-0.05830.009340.07780.250.480.71 1234567
JavaScript chart by amCharts 3.21.15SPAQ MDCP
       Returns  

Pair Trading with Horizon Kinetics and VictoryShares THB

The main advantage of trading using opposite Horizon Kinetics and VictoryShares THB positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Horizon Kinetics position performs unexpectedly, VictoryShares THB 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 VictoryShares THB will offset losses from the drop in VictoryShares THB's long position.
The idea behind Horizon Kinetics SPAC and VictoryShares THB Mid pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.

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