Correlation Between Kinetics Paradigm and Americafirst Defensive
Can any of the company-specific risk be diversified away by investing in both Kinetics Paradigm and Americafirst Defensive 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 Kinetics Paradigm and Americafirst Defensive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinetics Paradigm Fund and Americafirst Defensive Growth, you can compare the effects of market volatilities on Kinetics Paradigm and Americafirst Defensive 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 Kinetics Paradigm with a short position of Americafirst Defensive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Paradigm and Americafirst Defensive.
Diversification Opportunities for Kinetics Paradigm and Americafirst Defensive
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kinetics and Americafirst is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Paradigm Fund and Americafirst Defensive Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Americafirst Defensive and Kinetics Paradigm 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 Kinetics Paradigm Fund are associated (or correlated) with Americafirst Defensive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Americafirst Defensive has no effect on the direction of Kinetics Paradigm i.e., Kinetics Paradigm and Americafirst Defensive go up and down completely randomly.
Pair Corralation between Kinetics Paradigm and Americafirst Defensive
Assuming the 90 days horizon Kinetics Paradigm Fund is expected to generate 3.69 times more return on investment than Americafirst Defensive. However, Kinetics Paradigm is 3.69 times more volatile than Americafirst Defensive Growth. It trades about 0.08 of its potential returns per unit of risk. Americafirst Defensive Growth is currently generating about 0.05 per unit of risk. If you would invest 7,672 in Kinetics Paradigm Fund on November 28, 2024 and sell it today you would earn a total of 7,176 from holding Kinetics Paradigm Fund or generate 93.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Paradigm Fund vs. Americafirst Defensive Growth
Performance |
| Timeline |
| Kinetics Paradigm |
| Americafirst Defensive |
Kinetics Paradigm and Americafirst Defensive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Paradigm and Americafirst Defensive
The main advantage of trading using opposite Kinetics Paradigm and Americafirst Defensive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Paradigm position performs unexpectedly, Americafirst Defensive 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 Americafirst Defensive will offset losses from the drop in Americafirst Defensive's long position.| Kinetics Paradigm vs. Kinetics Small Cap | Kinetics Paradigm vs. Marsico 21st Century | Kinetics Paradigm vs. Royce Smaller Companies Growth | Kinetics Paradigm vs. Hodges Fund Retail |
| Americafirst Defensive vs. Pnc Balanced Allocation | Americafirst Defensive vs. Principal Lifetime Hybrid | Americafirst Defensive vs. Washington Mutual Investors | Americafirst Defensive vs. Knights Of Umbus |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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