Correlation Between ALTAIR RES and NORTHEAST UTILITIES
Can any of the company-specific risk be diversified away by investing in both ALTAIR RES and NORTHEAST UTILITIES 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 ALTAIR RES and NORTHEAST UTILITIES into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALTAIR RES INC and NORTHEAST UTILITIES, you can compare the effects of market volatilities on ALTAIR RES and NORTHEAST UTILITIES 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 ALTAIR RES with a short position of NORTHEAST UTILITIES. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALTAIR RES and NORTHEAST UTILITIES.
Diversification Opportunities for ALTAIR RES and NORTHEAST UTILITIES
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between ALTAIR and NORTHEAST is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding ALTAIR RES INC and NORTHEAST UTILITIES in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NORTHEAST UTILITIES and ALTAIR RES 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 ALTAIR RES INC are associated (or correlated) with NORTHEAST UTILITIES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NORTHEAST UTILITIES has no effect on the direction of ALTAIR RES i.e., ALTAIR RES and NORTHEAST UTILITIES go up and down completely randomly.
Pair Corralation between ALTAIR RES and NORTHEAST UTILITIES
Assuming the 90 days trading horizon ALTAIR RES INC is expected to generate 51.35 times more return on investment than NORTHEAST UTILITIES. However, ALTAIR RES is 51.35 times more volatile than NORTHEAST UTILITIES. It trades about 0.09 of its potential returns per unit of risk. NORTHEAST UTILITIES is currently generating about -0.02 per unit of risk. If you would invest 0.05 in ALTAIR RES INC on August 30, 2024 and sell it today you would earn a total of 0.00 from holding ALTAIR RES INC or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
ALTAIR RES INC vs. NORTHEAST UTILITIES
Performance |
| Timeline |
| ALTAIR RES INC |
| NORTHEAST UTILITIES |
ALTAIR RES and NORTHEAST UTILITIES Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALTAIR RES and NORTHEAST UTILITIES
The main advantage of trading using opposite ALTAIR RES and NORTHEAST UTILITIES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALTAIR RES position performs unexpectedly, NORTHEAST UTILITIES 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 NORTHEAST UTILITIES will offset losses from the drop in NORTHEAST UTILITIES's long position.| ALTAIR RES vs. NORWEGIAN AIR SHUT | ALTAIR RES vs. Corsair Gaming | ALTAIR RES vs. MYFAIR GOLD P | ALTAIR RES vs. Alaska Air Group |
| NORTHEAST UTILITIES vs. Apple Inc | NORTHEAST UTILITIES vs. Apple Inc | NORTHEAST UTILITIES vs. Superior Plus Corp | NORTHEAST UTILITIES vs. SIVERS SEMICONDUCTORS AB |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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