Correlation Between Network CN and Anterix

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

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

Diversification Opportunities for Network CN and Anterix

0.52

Correlation Coefficient

Network CN  Anterix

Very weak diversification

The 3 months correlation between Network and Anterix is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Network CN and Anterix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anterix and Network CN 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 Network CN are associated (or correlated) with Anterix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anterix has no effect on the direction of Network CN i.e., Network CN and Anterix go up and down completely randomly.

Pair Corralation between Network CN and Anterix

Given the investment horizon of 90 days Network CN is expected to generate 13.14 times more return on investment than Anterix. However, Network CN is 13.14 times more volatile than Anterix. It trades about 0.19 of its potential returns per unit of risk. Anterix is currently generating about 0.1 per unit of risk. If you would invest  4.21  in Network CN on December 29, 2024 and sell it today you would earn a total of  21.79  from holding Network CN or generate 517.58% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	96.83%
Values	Daily Returns

Network CN  vs.  Anterix

Network CN

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Network CN are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of very fragile fundamental indicators, Network CN displayed solid returns over the last few months and may actually be approaching a breakup point.

Anterix

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Anterix are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating technical and fundamental indicators, Anterix showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Network CN and Anterix

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

The idea behind Network CN and Anterix 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.