Correlation Between Nasdaq and PMGR Securities

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

By analyzing existing cross correlation between Nasdaq Inc and PMGR Securities 2025, you can compare the effects of market volatilities on Nasdaq and PMGR Securities 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 PMGR Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nasdaq and PMGR Securities.

Diversification Opportunities for Nasdaq and PMGR Securities

0.91

Correlation Coefficient

Nasdaq  PMGR Securities

Almost no diversification

The 3 months correlation between Nasdaq and PMGR is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Nasdaq Inc and PMGR Securities 2025 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PMGR Securities 2025 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 PMGR Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PMGR Securities 2025 has no effect on the direction of Nasdaq i.e., Nasdaq and PMGR Securities go up and down completely randomly.

Pair Corralation between Nasdaq and PMGR Securities

Given the investment horizon of 90 days Nasdaq Inc is expected to generate 9.84 times more return on investment than PMGR Securities. However, Nasdaq is 9.84 times more volatile than PMGR Securities 2025. It trades about 0.08 of its potential returns per unit of risk. PMGR Securities 2025 is currently generating about 0.26 per unit of risk. If you would invest  7,379  in Nasdaq Inc on September 21, 2024 and sell it today you would earn a total of  391.00  from holding Nasdaq Inc or generate 5.3% return on investment over 90 days.

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

Nasdaq Inc  vs.  PMGR Securities 2025

Nasdaq Inc

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Nasdaq Inc are ranked lower than 6 (%) 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.

PMGR Securities 2025

Risk-Adjusted Performance

20 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in PMGR Securities 2025 are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. In spite of comparatively stable basic indicators, PMGR Securities is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Nasdaq and PMGR Securities

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

The idea behind Nasdaq Inc and PMGR Securities 2025 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.