Correlation Between Kinetics Paradigm and Stone Harbor
Can any of the company-specific risk be diversified away by investing in both Kinetics Paradigm and Stone Harbor 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 Stone Harbor 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 Stone Harbor Local, you can compare the effects of market volatilities on Kinetics Paradigm and Stone Harbor 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 Stone Harbor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Paradigm and Stone Harbor.
Diversification Opportunities for Kinetics Paradigm and Stone Harbor
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Kinetics and Stone is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Paradigm Fund and Stone Harbor Local in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stone Harbor Local 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 Stone Harbor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stone Harbor Local has no effect on the direction of Kinetics Paradigm i.e., Kinetics Paradigm and Stone Harbor go up and down completely randomly.
Pair Corralation between Kinetics Paradigm and Stone Harbor
Assuming the 90 days horizon Kinetics Paradigm Fund is expected to generate 6.0 times more return on investment than Stone Harbor. However, Kinetics Paradigm is 6.0 times more volatile than Stone Harbor Local. It trades about 0.41 of its potential returns per unit of risk. Stone Harbor Local is currently generating about -0.07 per unit of risk. If you would invest 13,896 in Kinetics Paradigm Fund on September 1, 2024 and sell it today you would earn a total of 4,389 from holding Kinetics Paradigm Fund or generate 31.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Kinetics Paradigm Fund vs. Stone Harbor Local
Performance |
| Timeline |
| Kinetics Paradigm |
| Stone Harbor Local |
Kinetics Paradigm and Stone Harbor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Paradigm and Stone Harbor
The main advantage of trading using opposite Kinetics Paradigm and Stone Harbor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Paradigm position performs unexpectedly, Stone Harbor 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 Stone Harbor will offset losses from the drop in Stone Harbor'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 |
| Stone Harbor vs. Stone Harbor Emerging | Stone Harbor vs. Stone Harbor Emerging | Stone Harbor vs. Thrivent High Yield | Stone Harbor vs. Russell 2000 2x |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |