Correlation Between City National and Kinetics Global
Can any of the company-specific risk be diversified away by investing in both City National and Kinetics Global 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 City National and Kinetics Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between City National Rochdale and Kinetics Global Fund, you can compare the effects of market volatilities on City National and Kinetics Global 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 City National with a short position of Kinetics Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of City National and Kinetics Global.
Diversification Opportunities for City National and Kinetics Global
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between City and Kinetics is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding City National Rochdale and Kinetics Global Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinetics Global and City National 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 City National Rochdale are associated (or correlated) with Kinetics Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinetics Global has no effect on the direction of City National i.e., City National and Kinetics Global go up and down completely randomly.
Pair Corralation between City National and Kinetics Global
Assuming the 90 days horizon City National Rochdale is expected to generate 0.05 times more return on investment than Kinetics Global. However, City National Rochdale is 19.08 times less risky than Kinetics Global. It trades about 0.03 of its potential returns per unit of risk. Kinetics Global Fund is currently generating about -0.31 per unit of risk. If you would invest 1,976 in City National Rochdale on September 25, 2024 and sell it today you would earn a total of 1.00 from holding City National Rochdale or generate 0.05% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
City National Rochdale vs. Kinetics Global Fund
Performance |
Timeline |
City National Rochdale |
Kinetics Global |
City National and Kinetics Global Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with City National and Kinetics Global
The main advantage of trading using opposite City National and Kinetics Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if City National position performs unexpectedly, Kinetics Global 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 Global will offset losses from the drop in Kinetics Global's long position.City National vs. Jp Morgan Smartretirement | City National vs. Fidelity Managed Retirement | City National vs. Deutsche Multi Asset Moderate | City National vs. Saat Moderate Strategy |
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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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