Correlation Between National Bank and Take Two
Can any of the company-specific risk be diversified away by investing in both National Bank and Take Two 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 National Bank and Take Two into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Bank of and Take Two Interactive Software, you can compare the effects of market volatilities on National Bank and Take Two 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 National Bank with a short position of Take Two. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Bank and Take Two.
Diversification Opportunities for National Bank and Take Two
0.29 | Correlation Coefficient |
Modest diversification
The 3 months correlation between National and Take is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding National Bank of and Take Two Interactive Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Take Two Interactive and National Bank 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 National Bank of are associated (or correlated) with Take Two. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Take Two Interactive has no effect on the direction of National Bank i.e., National Bank and Take Two go up and down completely randomly.
Pair Corralation between National Bank and Take Two
Assuming the 90 days trading horizon National Bank of is expected to generate 14.34 times more return on investment than Take Two. However, National Bank is 14.34 times more volatile than Take Two Interactive Software. It trades about 0.14 of its potential returns per unit of risk. Take Two Interactive Software is currently generating about 0.17 per unit of risk. If you would invest 278.00 in National Bank of on November 27, 2024 and sell it today you would earn a total of 0.00 from holding National Bank of or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Bank of vs. Take Two Interactive Software
Performance |
| Timeline |
| National Bank |
| Take Two Interactive |
National Bank and Take Two Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Bank and Take Two
The main advantage of trading using opposite National Bank and Take Two positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Bank position performs unexpectedly, Take Two 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 Take Two will offset losses from the drop in Take Two's long position.| National Bank vs. Geely Automobile Holdings | National Bank vs. Infrastrutture Wireless Italiane | National Bank vs. AcadeMedia AB | National Bank vs. Gruppo MutuiOnline SpA |
| Take Two vs. Datalogic | Take Two vs. Westlake Chemical Corp | Take Two vs. International Consolidated Airlines | Take Two vs. CAP LEASE AVIATION |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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