Correlation Between Kinetics Paradigm and Value Fund
Can any of the company-specific risk be diversified away by investing in both Kinetics Paradigm and Value Fund 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 Value Fund 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 Value Fund Value, you can compare the effects of market volatilities on Kinetics Paradigm and Value Fund 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 Value Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Paradigm and Value Fund.
Diversification Opportunities for Kinetics Paradigm and Value Fund
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kinetics and Value is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Paradigm Fund and Value Fund Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Value Fund Value 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 Value Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Value Fund Value has no effect on the direction of Kinetics Paradigm i.e., Kinetics Paradigm and Value Fund go up and down completely randomly.
Pair Corralation between Kinetics Paradigm and Value Fund
Assuming the 90 days horizon Kinetics Paradigm Fund is expected to generate 3.8 times more return on investment than Value Fund. However, Kinetics Paradigm is 3.8 times more volatile than Value Fund Value. It trades about 0.41 of its potential returns per unit of risk. Value Fund Value is currently generating about 0.31 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 Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Kinetics Paradigm Fund vs. Value Fund Value
Performance |
| Timeline |
| Kinetics Paradigm |
| Value Fund Value |
Kinetics Paradigm and Value Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Paradigm and Value Fund
The main advantage of trading using opposite Kinetics Paradigm and Value Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Paradigm position performs unexpectedly, Value Fund 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 Value Fund will offset losses from the drop in Value Fund'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 |
| Value Fund vs. Partners Value Fund | Value Fund vs. Clipper Fund Inc | Value Fund vs. Longleaf Partners Fund | Value Fund vs. Third Avenue Value |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Bollinger Bands Use Bollinger Bands indicator to analyze target price for a given investing horizon | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. |