Correlation Between Nasdaq and Gruppo Mutuionline

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

By analyzing existing cross correlation between Nasdaq Inc and Gruppo Mutuionline SpA, you can compare the effects of market volatilities on Nasdaq and Gruppo Mutuionline 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 Nasdaq with a short position of Gruppo Mutuionline. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq and Gruppo Mutuionline.

Diversification Opportunities for Nasdaq and Gruppo Mutuionline

0.35

Correlation Coefficient

Nasdaq  Gruppo Mutuionline

Weak diversification

The 3 months correlation between Nasdaq and Gruppo is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq Inc and Gruppo Mutuionline SpA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gruppo Mutuionline SpA and Nasdaq 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 Nasdaq Inc are associated (or correlated) with Gruppo Mutuionline. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gruppo Mutuionline SpA has no effect on the direction of Nasdaq i.e., Nasdaq and Gruppo Mutuionline go up and down completely randomly.

Pair Corralation between Nasdaq and Gruppo Mutuionline

Given the investment horizon of 90 days Nasdaq Inc is expected to generate 1.25 times more return on investment than Gruppo Mutuionline. However, Nasdaq is 1.25 times more volatile than Gruppo Mutuionline SpA. It trades about 0.01 of its potential returns per unit of risk. Gruppo Mutuionline SpA is currently generating about -0.44 per unit of risk. If you would invest  8,192  in Nasdaq Inc on December 4, 2024 and sell it today you would earn a total of  5.00  from holding Nasdaq Inc or generate 0.06% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	95.24%
Values	Daily Returns

Nasdaq Inc  vs.  Gruppo Mutuionline SpA

Nasdaq Inc

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Nasdaq Inc are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Even with relatively invariable basic indicators, Nasdaq is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

Gruppo Mutuionline SpA

Risk-Adjusted Performance

Very Weak

Over the last 90 days Gruppo Mutuionline SpA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Gruppo Mutuionline is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Nasdaq and Gruppo Mutuionline

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

The idea behind Nasdaq Inc and Gruppo Mutuionline SpA 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.