Correlation Between Kinea Fundo and Kinea Renda

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

By analyzing existing cross correlation between Kinea Fundo Fundos and Kinea Renda Imobiliria, you can compare the effects of market volatilities on Kinea Fundo and Kinea Renda 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 Kinea Fundo with a short position of Kinea Renda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinea Fundo and Kinea Renda.

Diversification Opportunities for Kinea Fundo and Kinea Renda

0.34

Correlation Coefficient

Kinea Fundo  Kinea Renda

Weak diversification

The 3 months correlation between Kinea and Kinea is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Kinea Fundo Fundos and Kinea Renda Imobiliria in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kinea Renda Imobiliria and Kinea Fundo 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 Kinea Fundo Fundos are associated (or correlated) with Kinea Renda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kinea Renda Imobiliria has no effect on the direction of Kinea Fundo i.e., Kinea Fundo and Kinea Renda go up and down completely randomly.

Pair Corralation between Kinea Fundo and Kinea Renda

Assuming the 90 days trading horizon Kinea Fundo is expected to generate 2.72 times less return on investment than Kinea Renda. In addition to that, Kinea Fundo is 1.11 times more volatile than Kinea Renda Imobiliria. It trades about 0.03 of its total potential returns per unit of risk. Kinea Renda Imobiliria is currently generating about 0.1 per unit of volatility. If you would invest  12,507  in Kinea Renda Imobiliria on December 4, 2024 and sell it today you would earn a total of  805.00  from holding Kinea Renda Imobiliria or generate 6.44% return on investment over 90 days.

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

Kinea Fundo Fundos  vs.  Kinea Renda Imobiliria

Kinea Fundo Fundos

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Kinea Fundo Fundos are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat strong basic indicators, Kinea Fundo is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Kinea Renda Imobiliria

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Kinea Renda Imobiliria are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. Despite somewhat weak basic indicators, Kinea Renda may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Kinea Fundo and Kinea Renda

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

The idea behind Kinea Fundo Fundos and Kinea Renda Imobiliria 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.