Correlation Between Kinetics Paradigm and Domini Impact
Can any of the company-specific risk be diversified away by investing in both Kinetics Paradigm and Domini Impact 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 Domini Impact 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 Domini Impact International, you can compare the effects of market volatilities on Kinetics Paradigm and Domini Impact 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 Domini Impact. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Paradigm and Domini Impact.
Diversification Opportunities for Kinetics Paradigm and Domini Impact
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Kinetics and Domini is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Paradigm Fund and Domini Impact International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Domini Impact Intern 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 Domini Impact. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Domini Impact Intern has no effect on the direction of Kinetics Paradigm i.e., Kinetics Paradigm and Domini Impact go up and down completely randomly.
Pair Corralation between Kinetics Paradigm and Domini Impact
Assuming the 90 days horizon Kinetics Paradigm Fund is expected to generate 2.75 times more return on investment than Domini Impact. However, Kinetics Paradigm is 2.75 times more volatile than Domini Impact International. It trades about 0.35 of its potential returns per unit of risk. Domini Impact International is currently generating about -0.05 per unit of risk. If you would invest 10,890 in Kinetics Paradigm Fund on August 29, 2024 and sell it today you would earn a total of 7,051 from holding Kinetics Paradigm Fund or generate 64.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Paradigm Fund vs. Domini Impact International
Performance |
| Timeline |
| Kinetics Paradigm |
| Domini Impact Intern |
Kinetics Paradigm and Domini Impact Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Paradigm and Domini Impact
The main advantage of trading using opposite Kinetics Paradigm and Domini Impact positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Paradigm position performs unexpectedly, Domini Impact 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 Domini Impact will offset losses from the drop in Domini Impact'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 |
| Domini Impact vs. Domini Impact Bond | Domini Impact vs. Domini Impact Equity | Domini Impact vs. Parnassus Mid Cap | Domini Impact vs. Portfolio 21 Global |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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