Correlation Between NIKKON HOLDINGS and ALLFUNDS GROUP
Can any of the company-specific risk be diversified away by investing in both NIKKON HOLDINGS and ALLFUNDS GROUP 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 NIKKON HOLDINGS and ALLFUNDS GROUP into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NIKKON HOLDINGS TD and ALLFUNDS GROUP EO 0025, you can compare the effects of market volatilities on NIKKON HOLDINGS and ALLFUNDS GROUP 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 NIKKON HOLDINGS with a short position of ALLFUNDS GROUP. Check out your portfolio center. Please also check ongoing floating volatility patterns of NIKKON HOLDINGS and ALLFUNDS GROUP.
Diversification Opportunities for NIKKON HOLDINGS and ALLFUNDS GROUP
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between NIKKON and ALLFUNDS is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding NIKKON HOLDINGS TD and ALLFUNDS GROUP EO 0025 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ALLFUNDS GROUP EO and NIKKON HOLDINGS 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 NIKKON HOLDINGS TD are associated (or correlated) with ALLFUNDS GROUP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ALLFUNDS GROUP EO has no effect on the direction of NIKKON HOLDINGS i.e., NIKKON HOLDINGS and ALLFUNDS GROUP go up and down completely randomly.
Pair Corralation between NIKKON HOLDINGS and ALLFUNDS GROUP
Assuming the 90 days horizon NIKKON HOLDINGS TD is expected to generate 0.74 times more return on investment than ALLFUNDS GROUP. However, NIKKON HOLDINGS TD is 1.34 times less risky than ALLFUNDS GROUP. It trades about 0.12 of its potential returns per unit of risk. ALLFUNDS GROUP EO 0025 is currently generating about -0.13 per unit of risk. If you would invest 1,140 in NIKKON HOLDINGS TD on October 11, 2024 and sell it today you would earn a total of 60.00 from holding NIKKON HOLDINGS TD or generate 5.26% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
NIKKON HOLDINGS TD vs. ALLFUNDS GROUP EO 0025
Performance |
Timeline |
NIKKON HOLDINGS TD |
ALLFUNDS GROUP EO |
NIKKON HOLDINGS and ALLFUNDS GROUP Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with NIKKON HOLDINGS and ALLFUNDS GROUP
The main advantage of trading using opposite NIKKON HOLDINGS and ALLFUNDS GROUP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NIKKON HOLDINGS position performs unexpectedly, ALLFUNDS GROUP 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 ALLFUNDS GROUP will offset losses from the drop in ALLFUNDS GROUP's long position.NIKKON HOLDINGS vs. ALLFUNDS GROUP EO 0025 | NIKKON HOLDINGS vs. MidCap Financial Investment | NIKKON HOLDINGS vs. Apollo Investment Corp | NIKKON HOLDINGS vs. SEI INVESTMENTS |
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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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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