Correlation Between Victory Munder and Kinetics Internet

Can any of the company-specific risk be diversified away by investing in both Victory Munder and Kinetics Internet 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 Victory Munder and Kinetics Internet into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Victory Munder Multi Cap and Kinetics Internet Fund, you can compare the effects of market volatilities on Victory Munder and Kinetics Internet 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 Victory Munder with a short position of Kinetics Internet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory Munder and Kinetics Internet.

Diversification Opportunities for Victory Munder and Kinetics Internet

0.86

Correlation Coefficient

Victory Munder  Kinetics Internet

Very poor diversification

The 3 months correlation between Victory and Kinetics is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Victory Munder Multi Cap and Kinetics Internet Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinetics Internet and Victory Munder 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 Victory Munder Multi Cap are associated (or correlated) with Kinetics Internet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinetics Internet has no effect on the direction of Victory Munder i.e., Victory Munder and Kinetics Internet go up and down completely randomly.

Pair Corralation between Victory Munder and Kinetics Internet

Assuming the 90 days horizon Victory Munder is expected to generate 4.49 times less return on investment than Kinetics Internet. But when comparing it to its historical volatility, Victory Munder Multi Cap is 2.29 times less risky than Kinetics Internet. It trades about 0.18 of its potential returns per unit of risk. Kinetics Internet Fund is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest  7,705  in Kinetics Internet Fund on August 31, 2024 and sell it today you would earn a total of  3,990  from holding Kinetics Internet Fund or generate 51.78% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Victory Munder Multi Cap  vs.  Kinetics Internet Fund

Victory Munder Multi

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Victory Munder Multi Cap are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly inconsistent basic indicators, Victory Munder may actually be approaching a critical reversion point that can send shares even higher in December 2024.

Kinetics Internet

Risk-Adjusted Performance

27 of 100

Strong

Compared to the overall equity markets, risk-adjusted returns on investments in Kinetics Internet Fund are ranked lower than 27 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Kinetics Internet showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Victory Munder and Kinetics Internet

The main advantage of trading using opposite Victory Munder and Kinetics Internet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Victory Munder position performs unexpectedly, Kinetics Internet 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 Kinetics Internet will offset losses from the drop in Kinetics Internet's long position.

The idea behind Victory Munder Multi Cap and Kinetics Internet Fund pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.