Correlation Between Brightsphere Investment and NISOURCE
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By analyzing existing cross correlation between Brightsphere Investment Group and NISOURCE INC, you can compare the effects of market volatilities on Brightsphere Investment and NISOURCE 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 Brightsphere Investment with a short position of NISOURCE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Brightsphere Investment and NISOURCE.
Diversification Opportunities for Brightsphere Investment and NISOURCE
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Brightsphere and NISOURCE is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Brightsphere Investment Group and NISOURCE INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NISOURCE INC and Brightsphere Investment 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 Brightsphere Investment Group are associated (or correlated) with NISOURCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NISOURCE INC has no effect on the direction of Brightsphere Investment i.e., Brightsphere Investment and NISOURCE go up and down completely randomly.
Pair Corralation between Brightsphere Investment and NISOURCE
Given the investment horizon of 90 days Brightsphere Investment Group is expected to generate 8.11 times more return on investment than NISOURCE. However, Brightsphere Investment is 8.11 times more volatile than NISOURCE INC. It trades about 0.04 of its potential returns per unit of risk. NISOURCE INC is currently generating about 0.06 per unit of risk. If you would invest 2,042 in Brightsphere Investment Group on September 23, 2024 and sell it today you would earn a total of 659.00 from holding Brightsphere Investment Group or generate 32.27% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 99.4% |
Values | Daily Returns |
Brightsphere Investment Group vs. NISOURCE INC
Performance |
Timeline |
Brightsphere Investment |
NISOURCE INC |
Brightsphere Investment and NISOURCE Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Brightsphere Investment and NISOURCE
The main advantage of trading using opposite Brightsphere Investment and NISOURCE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Brightsphere Investment position performs unexpectedly, NISOURCE 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 NISOURCE will offset losses from the drop in NISOURCE's long position.The idea behind Brightsphere Investment Group and NISOURCE INC 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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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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