Correlation Between Kinetics Internet and Emerging Markets
Can any of the company-specific risk be diversified away by investing in both Kinetics Internet and Emerging Markets 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 Internet and Emerging Markets into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kinetics Internet Fund and Emerging Markets Equity, you can compare the effects of market volatilities on Kinetics Internet and Emerging Markets 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 Internet with a short position of Emerging Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Internet and Emerging Markets.
Diversification Opportunities for Kinetics Internet and Emerging Markets
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kinetics and Emerging is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Internet Fund and Emerging Markets Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerging Markets Equity and Kinetics Internet 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 Internet Fund are associated (or correlated) with Emerging Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerging Markets Equity has no effect on the direction of Kinetics Internet i.e., Kinetics Internet and Emerging Markets go up and down completely randomly.
Pair Corralation between Kinetics Internet and Emerging Markets
Assuming the 90 days horizon Kinetics Internet Fund is expected to generate 1.67 times more return on investment than Emerging Markets. However, Kinetics Internet is 1.67 times more volatile than Emerging Markets Equity. It trades about 0.2 of its potential returns per unit of risk. Emerging Markets Equity is currently generating about 0.31 per unit of risk. If you would invest 9,882 in Kinetics Internet Fund on April 13, 2025 and sell it today you would earn a total of 1,677 from holding Kinetics Internet Fund or generate 16.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kinetics Internet Fund vs. Emerging Markets Equity
Performance |
| Timeline |
| Kinetics Internet |
| Emerging Markets Equity |
Kinetics Internet and Emerging Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kinetics Internet and Emerging Markets
The main advantage of trading using opposite Kinetics Internet and Emerging Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kinetics Internet position performs unexpectedly, Emerging Markets 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 Emerging Markets will offset losses from the drop in Emerging Markets' long position.| Kinetics Internet vs. Victory Munder Multi Cap | Kinetics Internet vs. Tomorrows Scholar College | Kinetics Internet vs. Janus Global Technology | Kinetics Internet vs. Invesco Technology Fund |
| Emerging Markets vs. Elfun Diversified Fund | Emerging Markets vs. Wells Fargo Diversified | Emerging Markets vs. Global Diversified Income | Emerging Markets vs. Voya Solution Conservative |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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