Correlation Between NEOS ETF and Natixis ETF

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

By analyzing existing cross correlation between NEOS ETF Trust and Natixis ETF Trust, you can compare the effects of market volatilities on NEOS ETF and Natixis ETF 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 NEOS ETF with a short position of Natixis ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of NEOS ETF and Natixis ETF.

Diversification Opportunities for NEOS ETF and Natixis ETF

0.54

Correlation Coefficient

NEOS ETF  Natixis ETF

Very weak diversification

The 3 months correlation between NEOS and Natixis is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding NEOS ETF Trust and Natixis ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Natixis ETF Trust and NEOS ETF 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 NEOS ETF Trust are associated (or correlated) with Natixis ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Natixis ETF Trust has no effect on the direction of NEOS ETF i.e., NEOS ETF and Natixis ETF go up and down completely randomly.

Pair Corralation between NEOS ETF and Natixis ETF

Given the investment horizon of 90 days NEOS ETF Trust is expected to generate 0.88 times more return on investment than Natixis ETF. However, NEOS ETF Trust is 1.13 times less risky than Natixis ETF. It trades about 0.13 of its potential returns per unit of risk. Natixis ETF Trust is currently generating about 0.02 per unit of risk. If you would invest  2,564  in NEOS ETF Trust on November 28, 2024 and sell it today you would earn a total of  114.00  from holding NEOS ETF Trust or generate 4.45% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	96.55%
Values	Daily Returns

NEOS ETF Trust  vs.  Natixis ETF Trust

NEOS ETF Trust

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in NEOS ETF Trust are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, NEOS ETF is not utilizing all of its potentials. The latest stock price confusion, may contribute to short-horizon losses for the traders.

Natixis ETF Trust

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Natixis ETF Trust are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite fairly strong basic indicators, Natixis ETF is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with NEOS ETF and Natixis ETF

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

The idea behind NEOS ETF Trust and Natixis ETF Trust 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.