Correlation Between Kinetics Paradigm and Mondrian Global

Can any of the company-specific risk be diversified away by investing in both Kinetics Paradigm and Mondrian 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 Kinetics Paradigm and Mondrian Global 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 Mondrian Global Listed, you can compare the effects of market volatilities on Kinetics Paradigm and Mondrian 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 Kinetics Paradigm with a short position of Mondrian Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kinetics Paradigm and Mondrian Global.

Diversification Opportunities for Kinetics Paradigm and Mondrian Global

-0.07

Correlation Coefficient

Kinetics Paradigm  Mondrian Global

Good diversification

The 3 months correlation between Kinetics and Mondrian is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Kinetics Paradigm Fund and Mondrian Global Listed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mondrian Global Listed 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 Mondrian Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mondrian Global Listed has no effect on the direction of Kinetics Paradigm i.e., Kinetics Paradigm and Mondrian Global go up and down completely randomly.

Pair Corralation between Kinetics Paradigm and Mondrian Global

Assuming the 90 days horizon Kinetics Paradigm is expected to generate 1.48 times less return on investment than Mondrian Global. In addition to that, Kinetics Paradigm is 3.68 times more volatile than Mondrian Global Listed. It trades about 0.03 of its total potential returns per unit of risk. Mondrian Global Listed is currently generating about 0.16 per unit of volatility. If you would invest  1,011  in Mondrian Global Listed on December 24, 2024 and sell it today you would earn a total of  69.00  from holding Mondrian Global Listed or generate 6.82% return on investment over 90 days.

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

Kinetics Paradigm Fund  vs.  Mondrian Global Listed

Kinetics Paradigm

Risk-Adjusted Performance

Insignificant

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

Mondrian Global Listed

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Mondrian Global Listed are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak technical and fundamental indicators, Mondrian Global may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Kinetics Paradigm and Mondrian Global

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

The idea behind Kinetics Paradigm Fund and Mondrian Global Listed 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.

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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..